Key points:
- Vast Resources shares have rallied 114.7% after repaying the Atlas bonds.
- Investors cheered the move as it eliminated the future dilution of shareholders.
- Moreover, the mining company’s prospects are promising amid higher output.
The Vast Resources PLC (LON: VAST) share price has rallied 114.7% in the past three days after raising £3.2 million ($3.9 million) via a conditional subscription and securing an asset-backed loan facility worth $4 million.
Also read: The Best Nickel And Nickel Mining Stocks To Buy.
The mining company used the proceeds of the oversubscribed placing to repay the outstanding bonds owed to Atlas Special Opportunities LLC, which were delisted from The International Stock Exchange.
Investors cheered the repayment since it means that Atlas Special Opportunities no longer has the opportunity to convert any outstanding bonds into ordinary shares of Vast Resources, as it did recently, triggering a 51.8% decline in the Vast share price.
Atlas Special Opportunities LLC recently converted bonds worth $500,000 into Vast Resources ordinary shares, forcing the miner to issue 151 million new ordinary shares to meet the conversion request while diluting existing shareholders.
Vast Resources repaid Vast outstanding bonds worth over $4 million and reduced the debt owed to Mercuria Energy Trading SA by $1 million. However, there could have been bad blood between Vast Resources and Atlas Special Opportunities leading to the repayment.
The mining company believes that the repayment of the Atlas bonds “marks a definitive turning point for the company that the board believes should restore fair value in our share price.”
The company has been making significant progress at its Baita Plai mine, which is mechanising operations to increase its output. The miner also said that its operations in Tajikistan could start generating additional income streams.
Overall, Vast Resources’ prospects are pretty positive, so now might be a good time to buy some Vast shares. The company’s shares recently bounced off long term support at 0.27 and seemed to be headed higher. A break below this support level would invalidate the bullish thesis.
*This is not investment advice. Always do your due diligence before making investment decisions.
Vast share price.
The Vast Resources share price has risen 114.7% in the past three days. Will the rally continue?