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Business Writer
AIM – listed mining group Vast Resources Plc – which is developing a diamond project in the Chiadzwa diamond fields – has raised an amount in aggregate of £1, 4 million.
The funds were raised through a placing of 826 055 555 ordinary shares of 0.1 pence in the company at a price of 0.18 pence per Ordinary Share.
The Placing was undertaken by the Company’s Joint Broker, Axis Capital Markets Ltd.
“The company has received interest from certain other investors in participating for a further £109 800 on similar terms as the Placing and will make a further announcement as and when such arrangements are finalised,” said management.
The cash raised from the Placing together with further subscription proceeds as referred to above will provide funds to cash settle the liability to Atlas Capital Markets at the end of July or during August 2020, should Atlas decide to exercise its conversion rights prior to the Company finalising the refinancing announced on 15 May 2020.
At current share prices, the necessary sum to achieve this is estimated by the directors to be of the order of US$780 000 as announced on 24 October 2019 under the Atlas Bond Issue Deed there is a six months non-conversion period from the drawdown date (30 January 2020) after which Atlas may convert up to 10 percent of the par value of the Bond each month.
In addition, the funds being raised will provide the Company with funding for the first month’s production at the Baita Plai Polymetallic Mine until the first sale of concentrate expected in late August, together with some further general working capital.
Commenting on the development Andrew Prelea, the CEO of Vast said: “We are happy that the final stages of development at Baita Plai are proceeding on time and as planned and expect that the funds raised today will take us through to the anticipated date when we can achieve cash flow through the sale of concentrate.”
Last year, Vast Resources teamed up with the Chiadzwa community, creating a company called Katanga, which in turn partnered the Zimbabwe Consolidated Diamond Company (ZCDC) to mine diamonds.
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