The Premier African Minerals Ltd (LON: PREM) share price fell 8.7% after announcing that it had secured additional funding for its Zulu Lithium and Tantalum mine in Zimbabwe. The additional funding was secured by selling new shares to Canmax Technologies at a discounted price of 0.35p.
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The decline in PREM shares was expected, given the significant discount offered to the participating company. Still, it was nice to see that the PREM shares did not drop up to the price offered, showing investors' confidence in the company and its prospects.
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The funds were raised via a conditional subscription for new ordinary shares by Canmax Technologies Co., Ltd to raise £5 million before expenses at an issue price of 0.35 pence per new ordinary share. The funds are set to advance the company’s Zulu Lithium and Tantalum mine project.
Premier African Minerals signed the agreement with Canmax on 28 August 2023, when the two entered into a conditional subscription agreement under which Canmax conditionally agreed to subscribe for 1,428,571,428 new ordinary shares worth £5 million before expenses.
The subscription is expected to be executed within 15 business days following the agreement’s signing. After the deal’s completion, Canmax will own about 17.4% of the entire issued share capital of Premier African Minerals.
The subscription's completion will happen when written PREM receives confirmation that Canmax has received all applicable outbound direct investment approvals and/or registrations from and/or with competent Chinese administrative authorities concerning the Subscription.
The deal’s completion also relies on the standard warranties for a transaction of this type as set out in the Subscription agreement being true and accurate as of the payment date.
PREM shares had recouped some of their earlier losses and were trading down slightly from yesterday’s closing price at publishing.
Premier African Minerals CEO George Roach commented: “Our interests are aligned, our intentions are clear. Zulu must produce now, and we must look to expand the capacity. We deeply appreciate this Subscription; that is as positive a statement of support and alignment as we could ever have asked for.”
Premier African Minerals (PREM) share price.
The Premier African Minerals (PREM) share price fell 8.70% to trade at 0.42p, from Tuesday’s closing price of 0.46p.
YOUR CAPITAL IS AT RISK. 76% OF RETAIL CFD ACCOUNTS LOSE MONEY.