VBX has secured $4.5 million in firm placement commitments and agreed to convert a further $2.5 million of loan notes, giving the Wuudagu bauxite project funding through its delayed feasibility study. The company has also abandoned a proposed $10 million offtake-linked facility while it tests alternative development funding options.
- $4.5 million placement priced at $0.64 a share
- $2.5 million loan note conversion still needs shareholder approval
- Wuudagu DFS pushed back to Q1 2027
- 8 to 9 Mtpa throughput remains under assessment, not a new production target
- $10 million TKMTA prepayment and offtake term sheet terminated
VBX secures funding through the next Wuudagu phase
VBX Limited (ASX:VBX) has raised enough near-term capital to keep its Wuudagu bauxite project moving, but the funding package also reveals a project still being reshaped. The company has received firm commitments for a $4.5 million placement at $0.64 a share and agreed to convert $2.5 million of unsecured loan notes into equity, subject to shareholder approval.
The placement will issue 7,031,252 shares to new and existing strategic and institutional investors. It is being completed under VBX's existing placement capacity and represents a 15.5% discount to the five-day VWAP. If approved, the loan note conversion would issue another 3,906,250 shares at the same price, reducing the remaining loan note balance to $2.5 million.
Feasibility study moves into 2027
The cash is intended to fund completion of the Wuudagu Definitive Feasibility Study while the company pursues approvals and licences to construct and operate the project. Its delivery has now been extended to the first quarter of 2027 as VBX assesses cost and schedule opportunities identified through discussions with preferred contractors and potential project partners.
Those changes include evaluating a higher mining rate and product mass recovery, using a borefield as the preferred water supply solution, and co-locating marine infrastructure at Guy Point. VBX is also assessing an 8 to 9 million tonne per annum mining and beneficiation throughput rate. The company expressly says this is not a new production target and that it has not yet completed the work needed to establish a reasonable basis for one.
Alternative development funding replaces TKMTA proposal
VBX has elected to terminate the indicative $10 million prepayment and offtake term sheet signed with thyssenkrupp Materials Trading Asia in July. The proposed facility was never converted into definitive binding documentation. Terminating it leaves VBX free to examine preliminary operating, infrastructure and offtake-linked funding proposals through a formal process, with the stated aim of selecting a development funding solution after the DFS is complete.
That flexibility comes with an unresolved financing question: the announcement identifies interest and preliminary proposals, but no binding replacement facility. The company will therefore need to advance the DFS, regulatory approvals and funding process in parallel before Wuudagu can move from feasibility work towards construction.
Loan maturity extended as project team expands
VBX has extended the repayment date for its remaining unsecured loan notes from 31 December 2026 to 31 December 2027 and lifted the interest rate from 4.5% to 8.0% per annum. The notes were subscribed by Managing Director Ryan de Franck, through the Valperlon Trust, and an entity controlled by Non-Executive Director Richard de Franck. The board, excluding those directors, approved the updated terms as being on arm's-length terms and in the company's best interests.
Vivienne Powe is also moving from Non-Executive Director to Technical Director while remaining on the board as an Executive Director. VBX said the change is intended to add capability to the DFS and project delivery team as the revised scope is worked through. The next meaningful test is whether the extra time and capital produce a completed DFS, binding development funding and the approvals required to build Wuudagu.
Bottom Line?
VBX has extended its runway and preserved funding flexibility, but the investment case now hinges on a Q1 2027 DFS and a binding development financing solution.
Questions in the middle?
- Will the proposed $2.5 million loan note conversion receive shareholder approval?
- Can the revised DFS identify material cost or schedule improvements without delaying Wuudagu again?
- Which operating, infrastructure or offtake-linked funding proposal, if any, will become binding after the DFS?