Andrew Forrest part of EMA $36.5M injection

THE BOURSE WHISPERER: Energy and Minerals Australia (ASX: EMA) has strengthened its finances following a capital raising deal with Andrew Forrest and restructure of the company’s balance sheet.

EMA has entered into a binding term sheet with Forrest Family Investments Pty Ltd, an Andrew Forrest entity within the Minderoo Group, to raise $12 million by way of an equity capital raising.

If that’s not enough, the company has also announced its note holders, Australian resource investment groups Acorn Capital Limited and its clients (Acorn), Macquarie Bank (Macquarie) and the Element Resources Fund, have agreed that the debt owed to them shall be repaid in shares, subject to certain conditions.

As a result $24.5 million of debt will be eliminated and converted into shares.

The company indicated the two transactions will restructure its balance sheet and increase its net assets by $36.5 million.

Commenting on his side of the deal Andrew Forrest described his investment as a strong vote of confidence in EMA’s executive management team of Mike Young and Julian Tapp, both of whom he has worked with in the past in developing Fortescue Metals Group’s (ASX: FMG) Nullagine JV with BC Iron (ASX: BCI).

“Julian and I have always worked extremely well with Andrew Forrest,” EMA managing director Mike Young said in the company’s announcement to the Australian Securities Exchange.

“We are confident this investment in the new management team will unlock EMA’s potential and future growth.

“Raising $12 million in equity and eliminating all of EMA’s $24.5 million debt will increase the company’s net assets by $36.5 million and provide EMA with a strong balance sheet and a more normalised capital structure.

“EMA is now set up to move the Mulga Rock uranium project forward to meet uranium demand which is expected to grow at phenomenal rate in coming years.”

Email: info@eama.com.au

Website: www.eama.com.au