Institutions kick in $10 million in oversubscribed share placement

26 Jul 2016

Whenever you get a tick of approval for your work, it’s enormously satisfying.

That was certainly our experience in July’s oversubscribed share placement, which raised $10 million.

Our placement manager, Perth stockbroking firm DJ Carmichael, and co-manager, Empire Capital Partners, assisted in welcoming new, high-quality investment institutions from Australia, New Zealand and Asia onto our share register.

It’s always gratifying when new investors join our share register, particularly when they are hard-nosed professional investors who do a great deal of detailed due diligence. It’s even more satisfying when they express pleasant surprise at how advanced we are with our high purity alumina (HPA) project.

Most of the new investors that participated in our placement found the case for investing in Altech was very strong because:

·       The bankable feasibility study (BFS) was completed in June 2015,

·       We have in place an off-take agreement with Mitsubishi Corporation’s Australian subsidiary to take all the HPA we produce in the first 10 years of operation,

·       Our debt funding is well advanced through our project finance mandate with German bank KfW IPEX-Bank.

This assessment was directly reflected in demand for the placement, in which 71.4 million shares were issued.

The total amount we’ve raised since March 2016 stands at about $15 million, including $2 million from the sale of a surplus exploration licence.

The funds raised from the placement will go towards finalising the detailed design of our Malaysian HPA plant, finalising debt financing, and for working capital.

Institutional investor representation on our share register has increased from about 9% to closer to 23% following the placement. We’re especially pleased with this increase because a strong professional investor presence on the register is essential for establishing the credibility of both the Company and the HPA project.

Having institutions on the share register also attracts the interest of other institutions.  

So we’ll continue building institutional support for the HPA project ahead of a project finance equity raising, which will be required once debt funding arrangements have been finalised.