The directors of Nickel Mines Ltd. announced the successful completion of the institutional component (institutional entitlement offer) of its fully underwritten 1 for 3.6 accelerated pro-rata non-renounceable entitlement offer that was announced in April.
Proceeds from the institutional entitlement offer will be put toward funding cash consideration payable for Nickel Mines to increase its current 60 per cent ownership interests in both the Hengjaya Nickel RKEF Project (HNI) and the Ranger Nickel RKEF Project (RNI) to 80 per cent.
The companys collaboration partner Shanghai Decent Investment Group Co. Ltd. and its associates currently hold the other 40 per cent interests in both HNI and RNI.
The cash consideration payable to Shanghai Decent, in connection with the transactions of approximately US$150 million (A$231 million), will be funded by the net proceeds of the entitlement offer including the retail component of the entitlement offer, which is scheduled for settlement on 15 June 2020, and the companys existing cash reserves.
Shareholder approval for the transactions is being sought at the companys Annual General Meeting to be held on 29 May 2020 in accordance with the ASX Listing Rules.
The institutional entitlement offer raised approximately $179 million at A$0.50 per new share. It was well supported by institutional shareholders with take-up of approximately 75 per cent and strong demand from both existing Nickel Mines shareholders and new institutional investors with the balance of the institutional component, comprising renounced entitlements and entitlements attributable to ineligible shareholders, being oversubscribed.
Nickel Mines Managing Director Justin Werner said, We are delighted with the success of the offer which is a clear endorsement of the companys achievements to date and intention to increase its ownership interests in both HNI and RNI to 80%.