Tungsten Mining has secured firm commitments for a $50 million placement at $0.32 a share, giving its Watershed tungsten project fresh funding as it moves toward a final investment decision. The raise comes at a discount to recent market prices and will also support the company’s broader project portfolio.
- $50 million placement backed by new and existing institutional investors
- Funds primarily allocated to Watershed development and corporate purposes
- 156.25 million new shares priced at $0.32 each
- Offer price set at a 16.9% discount to the last close
- Watershed funding intended to support progress toward final investment decision
Watershed receives $50 million funding commitment
Tungsten Mining NL (ASX:TGN, OTCQB:TGNMF) has secured firm commitments for a $50 million placement, giving the company a sizeable new pool of capital to advance its Watershed tungsten project and fund general corporate purposes. The placement was backed by new and existing Australian and international institutional investors.
The company said the funds will be used primarily to progress Watershed towards a final investment decision, while also advancing its wider tungsten portfolio at Mt Mulgine. Chairman Gary Lyons described the raise as strengthening Tungsten Mining’s balance sheet, although the announcement does not say that a final investment decision has been made or that construction funding is complete.
Shares issued at a discount to market
The placement price of $0.32 represents a 16.9% discount to Tungsten Mining’s last closing price of $0.385 on 18 September and a 9.8% discount to its 15-day VWAP of $0.355. That pricing helped secure the institutional commitments, but it also means existing shareholders face dilution when the new shares enter the register.
The detailed allocation totals approximately 156.25 million new ordinary shares. Of those, 16,615,980 shares will be issued under the company’s ASX Listing Rule 7.1 capacity and 139,634,020 under its Rule 7.1A capacity. The new shares will rank equally with existing shares, and the placement does not require shareholder approval or underwriting.
Settlement places Watershed milestones in focus
Settlement is scheduled for 24 September, with quotation of the new shares expected on 25 September under an indicative timetable that may change. Euroz Hartleys and Jefferies Australia acted as joint lead managers.
The immediate question is how quickly the new capital converts into project progress. Tungsten Mining has identified Watershed as the principal use of funds and says the placement positions it to move towards a final investment decision, but the filing does not disclose total development costs, the post-placement share count or any confirmed production timetable. Those details will determine how much of the project’s funding burden this raise actually covers.
Bottom Line?
The raise removes an immediate funding hurdle for Watershed, but the next test is whether the new capital can carry the project through development milestones and towards a funded final investment decision.
Questions in the middle?
- What proportion of Watershed’s total development funding will the $50 million cover?
- When will Tungsten Mining provide a confirmed final investment decision and the remaining financing plan?
- How will the 156.25 million new shares affect the company’s post-placement capital structure?