The Vast Resources PLC (LON: VAST) share price fell 15.6% after revealing that it had raised gross proceeds of £2,382,500 via a subscription and placing 433,181,818 ordinary shares priced at 0.55p each, representing a significant discount to Friday’s closing price.
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Investors’ adverse reaction to the announcement was expected given the discounted price offered to the participating shareholders; hence, the drop in Vast Resources’ share price. Vast Resources’ CEO, Andrew Prelea, also participated in the capital raise showing his confidence in the firm’s prospects.
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The mining company noted that the funds raised would fund its ongoing drilling campaign and ramp up production at its Baita Plai Polymetallic Mine in Romania. The firm is making decent progress towards achieving its target of producing 14,000 tonnes per month of concentrate in H1 2023, given its robust production and sales performance in Q4 2022.
Vast Resources is working to confirm its expanded Exploration Target of up to 5.8 million tonnes by increasing its Measured and Indicated Resource estimates by proving and obtaining a new Mineral Resource Estimate (MRE).
The company is optimistic that it can obtain the enlarged MRE with grades of 0.50–2.00% copper, 0.20–0.80 g/t gold and 40-80g/t silver, which were part of the historic NAEAN code Resource.
Vast Resources will conduct the resource expansion project in two phases. The first phase will focus on confirming the resources that can be exploited soon, which could form part of its production ramp-up. The second phase will identify areas that can be mined in the future, which will help the firm prepare an underground access path.
The company will also use part of the proceeds to reduce some of its corporate obligations, including a debt reduction payment to Mercuria Energy Trading SA based on the terms agreed by the two firms and published on 16 May 2022.
Vast shares had recouped all their losses and were trading up 17.68% at the time of writing as investors digested all the positive aspects of today’s release.
*This is not investment advice.
Vast Resources share price.
The Vast Resources share price fell 15.58% to trade at 0.5445p, from Friday’s closing price of 0.6450p.
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