Mindax Limited has locked in a total of A$3.9 million in convertible note funding from Singapore-based L&Y Investment Holdings, contingent on Foreign Investment Review Board approval. The unsecured notes carry 10% interest and could dilute existing shareholders by up to 4.63%.
- A$3.9 million raised via unsecured convertible notes
- Notes carry 10% annual interest and 12-month maturity
- Conversion price fixed at A$0.033 per share
- Funding subject to FIRB approval due to foreign investor
- Potential shareholder dilution capped at 4.63%
Convertible Note Funding Completes Capital Raise
Mindax Limited (ASX:MDX) has finalised a convertible note funding round with Singapore-based L&Y Investment Holdings Pte Ltd, securing a further A$3.25 million and bringing the total to A$3.9 million. This funding round, announced initially on 31 August 2026, provides Mindax with additional working capital to support its mineral exploration efforts in Western Australia without immediately issuing shares at current market prices.
Terms and Conditions Highlight FIRB Approval Requirement
The unsecured notes carry a 10% per annum interest rate, mature in 12 months, and convert at a fixed price of A$0.033 per share. Conversion can be triggered by either party before maturity, but is contingent on Foreign Investment Review Board (FIRB) approval, given L&Y’s foreign status. Subscription monies are payable within three business days and can be used by Mindax as unsecured debt until FIRB approval is secured.
Should FIRB approval not be granted within the stipulated timeframe, set at a maximum of eight months with possible extensions, the agreement allows either party to terminate, with Mindax obliged to repay the principal plus interest within 30 business days. This introduces a regulatory uncertainty that investors will need to monitor closely.
Shareholder Impact and Dilution Risk
Conversion of the notes could issue up to approximately 114.8 million new shares, diluting existing shareholders by up to 4.63%. L&Y currently holds 190 million shares, about 8.04% of Mindax’s capital, and full conversion would raise their stake to roughly 12.3%. Conversion is subject to conditions including maintaining voting power below 20% and compliance with ASX Listing Rule 7.1, otherwise shareholder approval would be required.
Mindax’s existing placement capacity under ASX Listing Rule 7.1 covers this issue, so no additional shareholder approval is needed. This approach allows the company to raise funds efficiently but does pose a dilution risk that shareholders should weigh against the benefits of the capital injection.
Capital to Fuel Exploration and Tenement Commitments
The funds raised will be allocated towards exploration activities, tenement commitments, and general working capital. This financial boost arrives as Mindax continues to advance its strategic projects in Western Australia, including the Mid-West iron ore initiatives and gold exploration efforts, which have been highlighted in previous company updates. The convertible note structure provides a bridge of capital while delaying share issuance amid prevailing market conditions.
Bottom Line?
Mindax’s convertible note funding offers near-term capital relief but hinges on FIRB approval, leaving a regulatory wildcard and potential dilution for shareholders.
Questions in the middle?
- Will FIRB approval be granted within the extended timeframe?
- How will Mindax prioritise exploration spending with the new funds?
- What are the implications if conversion rights are not exercised before maturity?