Strandline hooks new investor as part of latest fund raising

28th February 2020
Resoures Rising Star

Strandline Resources has attracted A$2 million from an undisclosed new institutional investor keen on its mineral sands prospects and is set to raise another $4.5 million via a fully underwritten rights issue (reports MiningNews).

The new shares are to be priced at 12c each, with Strandline's stock little changed over the past two years.

Strandline last issued more equity last May when $5.5 million was raised by issuing new shares at 12c each.

The funding being raised this time will again go towards its Coburn pre-development project in Western Australia, with financing and "pre-execution" work planned.

Last week Strandline said the project financing process was advancing with debt terms under negotiation with lenders, including the Northern Australian Infrastructure Facility (NAIF).

Feasibility work last April pointed to development capital of $210-260 million, with an initial project life of more than 20 years.

Earlier this month an ASX mineral sands peer of Strandline's, Sheffield Resources, said it was looking to significantly reduce the capital cost (and hence production profile) of its Thunderbird project in WA, after failing to find a financing solution for the $400-500 million development.

Shares in Strandline were unchanged at 12.5c in midday trade, capitalising the company at $49 million.

Coincidentally, Sheffield shares were also at 12.5c today, capitalising it at nearly $39 million.

On an enterprise value basis, Strandline was valued at about $46 million prior to today's fundraising announcement, while Sheffield's worth was put at about $20 million less.

Strandline is also the owner of an advanced, smaller scale development opportunity in Tanzania.

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