Bowen Coking Coal has confirmed it is making efforts to raise $70m in a partially underwritten deal.
The 2.66-for-one pro rata renounceable entitlement offer with one free attaching unlisted option for every two shares subscribed is at 0.9c a share.
Bowen Coking Coal said it had received about $40.5m in commitments from major shareholders Crocodile Capital 1 Global Focus Fund, Crocodile Capital Offshore Fund, Crocodile Capital Partners GmbH as well as new investors Square Resources or its nominee and Taurus Mining Finance Fund Number 2, which is partially owned by Regal Funds and is the group’s debt provider.
The use of the proceeds is to fund the Plumtree North mine development costs at its Burton Mine Complex, pre-payments, guarantees and general working capital requirements.
Executive chairman Nick Jorss said that the offer is planned to strengthen the company’s balance sheet following its successful debt renegotiation.
The group has been hard hit by rising costs and a falling coal price along with the Queensland state royalties.
The company said the Burton operations were now performing strongly.
The offer price is a 25 per cent discount to Bowen’s last closing price of 1.21c on September 13.
Working on the deal is Shaw and Partners and Morgans, which are underwriting up to $40.5m provided a $60m minimum subscription is reached under the offer and consent of MPC Lenton is obtained.
Grant Samuel is the financial adviser, while Herbert Smith Freehills are legal counsel.
Bowen Coking Coal mines coal in Queensland’s Bowen Basin, with its flagship project being its Burton Mine Complex near Moranbah.
DataRoom on Friday flagged moves by the company to secure $70m from investors.
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