Ora Banda raises cash for Davyhurst restart
PERTH (miningweekly.com) – ASX-listed Ora Banda mining has launched a A$55-million capital raise to underpin the restart activities at its Davyhurst gold project, in Western Australia.
The equity raising will consist of an institutional share placement to raise an initial A$40-million, and a one-for-nine accelerated non-renounceable entitlement offer to raise a further A$15-million.
The share placement will be done in two tranches, with the first consisting of more than 95.6-million shares, priced at 23c each, to be placed under Ora Banda’s existing placement capacity.
A second tranche of a minimum of 78.2-million shares will be placed to shareholder Hawke’s Point, subject to shareholder approval.
Meanwhile, the entitlement offer will also be split into an institutional and retail entitlement offer, also priced at 23c a share.
The offer price represented a 9.8% discount to Ora Banda’s last closing price, and a 7.18% discount to theoretical ex rights price of 24.7c a share.
“The capital raising is a significant step for the company as we advance towards production at Davyhurst. It will provide the funding required for the production restart and will strongly position Ora Banda to become a debt-free gold production company in the first quarter of 2021,” said MD David Quinlivan.
A newly completed definitive feasibility study on the restarted Davyhurst project estimated that it could produce about 81 000 oz/y of gold over a mine life of an initial five years, at a C1 cost of A$1 427/oz. The project is expected to require a capital investment of A$45-million, and would have a pay-back period of 14 months, which could reduce to seven months at a gold price of A$2 550/oz.
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