THE BOURSE WHISPERER: Venturex Resources (ASX: VXR) is set to chock up its coffers via a $6.4 million fund raising.
The company has announced it is undertaking a placement of 60 million shares at two cents per share to one of its significant shareholders, Henghou Industries (Hong Kong) Limited to raise $1.2 million.
Venturex is also undertaking a 2:11 non-renounceable Entitlement Issue for all eligible shareholders to subscribe for shares at two cents per share to raise approximately $5.22 million.
The company indicated the Entitlement Issue is supported by other significant shareholders, Regent Pacific as well as Henghou Industries, both of which have indicated their intention to subscribe for their entitlements.
Venturex said the $6.42 million raising, together with the company’s existing cash reserves, ensures it is funded for the next 12 months.
This will come in handy as the company looks to develop the resource base at the company’s Pilbara copper-zinc project and optimises the project’s development framework.
“The funds will be applied to undertake the project enhancement program, expand the exploration programs in the Pilbara and for general working capital purposes,” Venturex Resources explained in its ASX announcement.
Following completion of the planned Entitlement Issue, the Company will receive approx. $6.35 million (after transaction costs) resulting in a net cash position of $7.8 million.
The company outlined its intentions for the raised funds as:
$0.3 million for an optimisation program;
$3.4 million spent on exploration in Australia;
$0.2 million spent on exploration in Brazil;
$0.5 million spent at the company’s Whim Creek Site; and
$2 million left for working capital.