Company Presentation and Capital Raising
Perth, Feb 19, 2015 AEST (ABN Newswire) - ABM Resources NL (
ASX:ABU) announce the most recent Company Presentation, including details on the capital raising.
Offer Structure ABM Resources is raising approximately $12.7 million via:
- An institutional placement of up to 22.7 million shares to raise approximately $5 million ("Placement"); and
- A 1:8 non-renounceable fully underwritten entitlement offer to raise approximately $7.7 million ("Entitlement Offer")
- The placement shares will not be eligible to participate in the Entitlement Offer and will represent approximately 6.75% of the issued capital post completion of the Entitlement Offer
- New shares will rank pari passu with ABM Resources' existing shares
- Provision also made for additional placement of 6.8 million shares for $1.5 million under original agreement with Pacific Road Capital (note 1)
Offer pricing
The Offer Price is $0.22 per new share. This represents a discount of:
- 18.5% to the last close
- 20.6% to the 5 day VWAP
- 28.1% to the 30 day VWAP
- 15.9% to the TERP of $ 0.261
Substantial shareholder participation
Pacific Road Capital Management and APAC Resources have committed to subscribe for their full entitlements under the Entitlement Offer
Use of proceeds
Development of the Old Pirate gold project, to increase extensional exploration activity, and general working capital expenses Bookrunners, Underwriters and Joint Lead Managers Argonaut Capital Limited & Canaccord Genuity (Australia) Limited
General Notes:
* High grade, high margin near term gold production at Old Pirate(note 1)
- Existing resource estimation of 640,000 ounces at 11.7g/t gold
- First year's open pit production guidance of 50,000-60,000 ounces at a head grade of 11g/t - 13g/t
- A$690-790 per ounce operating cost target
- A$750-870 per ounce "all in" sustaining cost target
- High metallurgical recoveries estimated at >97% including >85% expected by gravity methods.
- Development underway with first ore stockpiling expected in March and commissioning expected in May 2015
* Coyote Mill lease and option to purchase agreement provides low cost start up capex solution (note 2)
- Pay back period of less than one quarter at current A$ gold prices
* Equity raising allows ABM Resources to remain debt free
- Allows an increase in extensional exploration activity at Old Pirate and environs
- ANZ working capital facility remains in reserve
- Anticipated strong operating cashflows accrue for the benefit of shareholders
* Supportive long term strategic shareholders account for ~35% of the register
* Near mine and regional exploration offering potential upside:
- New near mine zones such as Vampire with multiple veins & visible gold (note 3)
- New high-grade zone at Old Glory South (note 4)
- Multiple other targets and extensions for potential high-grade vein gold deposits within trucking distance to Coyote Plant
- Buccaneer Porphyry Gold Deposit with 1.1 million ounces of gold in resource estimation (note 5)
To view the company presentation, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-ABU-710316.pdf
About ABM Resources NL
ABM Resources (ASX:ABU) is developing several gold discoveries in the Central Desert region of the Northern Territory of Australia. The Company has a multi-tiered approach to exploration and development with a combination of high-grade production scenarios such as the Old Pirate High-Grade Gold Project, large scale discoveries such as Buccaneer, and regional exploration discoveries such as the Hyperion Gold Project. In addition, ABM is committed to regional exploration programs throughout its extensive holdings including the alliance with Independence Group NL at the regional Lake Mackay Project.
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