Magnetite Mines clears SPP cap and raises $1.32 million for Razorback

Magnetite Mines Ltd (ASX:MGT) has raised approximately $1.32 million without scaling back shareholder applications, giving its Razorback Iron Ore Project a fresh tranche of funding as the company pursues a lower-capital development pathway and strategic opportunities.

The Share Purchase Plan raised approximately $824,500, the maximum amount the company said it could accept under the relevant ASX Listing Rule 7.2 exception. Demand exceeded that ceiling, with approximately $40,000 of excess subscriptions transferred into a separate top-up placement after agreement from the relevant sophisticated investor shareholders. The result was a total raise of approximately $1.3165 million.

Shareholder Plan Reaches Its Regulatory Cap

The SPP issued 68,704,266 shares at $0.012 each. That price was set at the lower of $0.015 and a 10% discount to the five-day VWAP through the 23 October closing date, representing a 20% discount to the last traded price before the capital raising was announced. The company had originally outlined the October SPP launch as targeting approximately $1 million, with free options attached subject to approval.

Top-Up Placement Adds $492,000

GBA Capital managed the top-up placement, which will issue a further 41,024,281 shares on the same terms. Of those shares, 22,901,422 will be issued under the company’s Listing Rule 7.1A capacity and 18,122,859 under Listing Rule 7.1. Across both components, the raising adds 109,728,547 shares to the register.

The capital arrives after Magnetite had flagged funding uncertainty as Razorback underwent a strategic reset. The company previously reported year-end cash of $2.01 million and said its existing resources were insufficient to fund planned activities for the following 12 months, while auditors identified material uncertainty around going concern. The new raise therefore improves available funding, but does not remove the company’s reliance on future capital, partners or transactions to support its broader plans.

Razorback Funding Comes With Potential Option Dilution

Net proceeds are earmarked for the Razorback project, strategic partnering and investment initiatives, potential acquisitions or transactions, selective exploration across the South Australian tenement package and general working capital. The company has not disclosed the exact net proceeds after costs in this announcement.

Investors in both parts of the raising are also entitled to one free quoted option for every new share subscribed, subject to shareholder approval at the forthcoming AGM. That would create 109,728,547 options exercisable at $0.015 and expiring on 31 December 2029. The options could provide additional funding if exercised, but would also increase the potential dilution already created by the share issue.