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FinnAust Mining plc / EPIC: FAM / Market: AIM / Sector: Mining

FinnAust Mining plc has successfully raised £8.5 million  See 19 page PDF Version

FinnAust Mining plc (‘FinnAust’ or the ‘Company’), the AIM listed exploration and development company with projects in Greenland & Finland is pleased to announce that it has successfully raised £8.5 million from the issue of 76,428,572 new ordinary shares of 0.01 pence each in the capital of the Company (‘New Placing Shares’) and the placing of 45,000,000 existing ordinary shares of 0.01 pence each in the capital of the Company (‘Existing Shares’) at a placing price of 7 pence per share (together ‘the Placing’). Both new and existing investors were procured by the Company’s brokers SP Angel Corporate Finance LLP (‘SP Angel’) and Mirabaud Securities LLP (‘Mirabaud’) who were appointed as placing agents. The Placing was significantly over-subscribed. The Existing Shares were made available to investors by Western Areas Limited (‘Western Areas’), the largest shareholder of FinnAust.

The gross proceeds of the issue of the New Placing Shares is £5.35 million. The net proceeds of the Placing attributable to the Company (being approximately £5.05 million after fees and expenses) will be used to accelerate the development of the Pituffik Titanium Project, the Company’s flagship ilmenite project in Greenland. This will include a proof of concept bulk sample, completion of the Feasibility Study and completion of the exploitation application process in 2017. Other work programmes will include the finalisation of the Environmental Impact Assessment (‘EIA’), the Social Impact Assessment (‘SIA’) as well as on-going detailed metallurgical and engineering work. Activity will also include the maiden resource statement for the Pituffik Titanium Project, which is expected in the first quarter of 2017.

The Pituffik Titanium Project has demonstrated the potential to be one of the highest mineral grade ilmenite projects in the world. With this in mind the Company’s primary focus is on delivering a significant proof of concept bulk sample in 2017. The Pituffik Titanium Project comprises three main target areas along more than 80km of coastline historically proven to contain large and high-grade accumulations of primary ilmenite, with mining in Greenland envisaged to be achieved via a low capex dredging operation.

FinnAust’s Managing Director, Roderick McIllree said, “This fundraising was well supported and I’m pleased to welcome new, strong institutional shareholders to the Company that share our vision. We are pleased with the progress made to date and remain confident of delivering our stated goals. With the maiden resource for the project due in the first quarter of 2017, we continue to be of the view that the Pituffik Titanium Project will soon be recognised as a globally significant ilmenite deposit both in terms of grade and tonnage.

“We would like to thank our major shareholder Western Areas for confirming their continued support to FinnAust whilst allowing the Company to bring on-board new institutional shareholders to deepen the share register, with limited dilution to existing shareholders at this formative stage.”

Western Areas’ (ASX ticker “WSA”) Chief Executive Officer, Dan Lougher – commenting on the transaction said, “Western Areas is delighted with the progress Rod and his team at FinnAust have made in advancing Pituffik towards full commerciality. We have reduced our holding to 22.85% to accommodate the inclusion of some high calibre new shareholders. We also confirm our long term commitment to continue as a cornerstone investor in the Company as we look forward to the very positive future that the Pituffik asset presents.”

Bluejay Consideration

Further to previous announcements by the Company, deferred consideration of 40,755,885 new ordinary shares of 0.01 pence each in the capital of the Company (‘Deferred Consideration Shares’) is payable to the vendors of Bluejay Mining Limited (‘Bluejay’) upon:

  • Bluejay being granted a mineral exploration permit over the offshore Pituffik project area; and
  • the issue of the Deferred Consideration Shares not triggering a mandatory offer pursuant to Rule 9 of the Takeover Code.

On 13 July 2016 the Company announced that it had been granted an extension of its existing licence to include all minerals within the shallow marine environment at the Pituffik project area (‘Offshore Licence Grant’). As a result of the Offshore Licence Grant and the issue of the New Placing Shares, the Company was obligated to issue the Deferred Consideration Shares. Accordingly, the Deferred Consideration Shares were issued to the vendors of Bluejay on 8 December 2016.

Roderick McIllree and Gregory Kunzel, both Directors of FinnAust, are amongst the vendors of Bluejay. The full details concerning the issue of Deferred Consideration Shares to them is set out in the table list in the
See PDF Version Placing to raise £8.5 million

FOR FURTHER INFORMATION PLEASE CONTACT:

Roderick McIllree
Managing Director
+44 (0) 20 7907 9326
www.titanium.gl

INDUSTRY: Manufacturing and Production-Mining and Metals PDF Version

Director

Interest in existing Ordinary Shares

Number of Deferred Consideration Shares issued

Interest in Ordinary Shares following the Placing and issue of Deferred Consideration Shares

Percentage interest in Ordinary Shares following the Placing and issue of Deferred Consideration Shares

Roderick McIllree

42,966,685

14,133,537

57,100,222

9.34%

Gregory

Kuenzel

17,395,791

5,712,334

23,108,125

3.78%