Rokeby Resources has secured $1.3 million through a placement and is seeking a further $1.7 million from eligible shareholders to fund resource estimation, drilling access and working capital. The raise comes at a discount and could materially expand the share count, while attaching options remain subject to shareholder approval.
- $1.3 million placement at $0.002 a share
- SPP targeting approximately $1.7 million, with oversubscriptions possible
- One option for every two shares, exercisable at $0.0065, subject to approval
- Funds directed to resource estimation, drilling access and working capital
- Placement price represents a 33.3% discount to the latest closing price
Rokeby locks in $1.3 million placement
Rokeby Resources Limited (ASX:RKB) has secured $1.3 million from professional and sophisticated investors, giving the junior gold explorer funding to keep its resource and drilling plans moving despite what managing director Andrew Haythorpe described as difficult conditions for junior gold companies.
The placement will issue approximately 650 million shares at $0.002 each. That price is 9.1% below the five-day VWAP, 25.9% below the 15-day VWAP and 33.3% below Rokeby’s $0.003 closing price on 28 October. The placement is expected to settle on 9 November, with the new shares due to be issued on 10 November.
SPP could take the raise towards $3 million
Rokeby is also offering eligible Australian and New Zealand shareholders the chance to subscribe at the same $0.002 price through a share purchase plan targeting approximately $1.7 million. Applications will range from $2,000 to $30,000, with the company able to accept oversubscriptions up to a maximum of 893,019,023 shares, worth about $1.786 million.
The SPP is not underwritten, so the full target is not guaranteed. Any shortfall may be placed at the board’s discretion, subject to the ASX Listing Rules and shareholder approvals where required. The funding push comes after the cash runway warning, which reported A$156,000 in cash alongside the completion of Rokeby’s maiden Sunnyside drilling program and an 11,337-ounce Inferred resource at Powers Gully.
Resource estimate and next drilling program are the priorities
Rokeby said the proceeds will be applied primarily to ongoing resource estimation, securing access for its next drilling program and short-term working capital. The company has not named a specific project allocation in the raising announcement, although its recent exploration program has focused on the Mt Wills Goldfield and the Sunnyside deposit within the Omeo Gold Project.
The latest funding arrives as Rokeby works towards an updated JORC resource estimate following high-grade Sunnyside results, including the 138 g/t Sunnyside intercept reported in October. The raise provides money for the next stage of work, but it does not establish whether further drilling or resource estimation will produce a larger mineral resource.
Options and director participation still need approval
Placement and SPP participants will receive one free unlisted option for every two new shares, with each option exercisable at $0.0065 and expiring on 30 November 2028. The options require shareholder approval, as does a separate 40 million-share director tranche under the placement.
Rokeby will seek those approvals at a general meeting expected on 17 December. Shareholders will also vote on 100 million broker options for lead manager SP Corporate Advisory, exercisable on the same terms. SP Corporate Advisory will receive a 6% fee on placement funds and any SPP shortfall it places, plus a monthly corporate advisory fee, adding to the cost and potential dilution attached to the capital raising.
Bottom Line?
The placement is firm, but the larger SPP remains uncertain and the eventual dilution will depend on participation, option approvals and how quickly the new capital converts into resource and drilling progress.
Questions in the middle?
- How much of the $1.7 million SPP target will shareholders ultimately fund?
- Will shareholders approve the attaching options, director tranche and broker options in December?
- Can the new capital advance Rokeby’s resource estimate and next drilling program before another funding requirement emerges?