Caledonia raises US$10.6m for Zim projects
BUSINESS REPORTER
Caledonia Mining Corporation Plc has raised US$10.6m to finance its planned work at the three new gold projects in Zimbabwe after issuing new shares to investors.
In total, the resources concern wants to raise about US$13m with the remainder to be raised from the Zimbabwe placing which closes tomorrow. IH Securities is undertaking on behalf of Caledonia a placing in Zimbabwe of the Zimbabwe depositary receipts to raise about US$3m.
In an update on Tuesday, the Victoria Falls Stock Exchange listed resources concern said the funds raised under the placing were US$10.6m before expenses.
A total of 781,749 placing shares have been placed with domestic and international institutional and sophisticated investors, conditional on admission, at the placing price of US$13.74 per share.
Caledonia said the net proceeds of the fundraise, together with the company’s existing cash reserves and the future cash to be generated from its ownership of the producing and cash generative Blanket Mine and from the Bilboes oxide operation, will strengthen the company’s balance sheet and provide it with working capital flexibility to accelerate planned work at the three new gold projects it is currently undertaking in Zimbabwe.
Caledonia plans to spend US$2m of the net proceeds to fund a new feasibility study to investigate commercialisation of Bilboes, possibly through a phased development approach. Bilboes was acquired in January this year. Bilboes has produced approximately 288,000 ounces of gold since 1989.
Caledonia will inject US$6m of the fundraise proceeds for further exploration at Motapa, a large exploration property which is contiguous to the Bilboes gold project and approximately 75km north of Bulawayo.
The resources concern said it would use about US$2m of the net proceeds of the fundraise on the drilling and exploration of the claims at Maligreen, the asset Caledonia acquired in 2021.
Caledonia CEO Mark Learmonth said the “modest” fund raise “allows us to accelerate progress on our very attractive package of exploration and development assets in Zimbabwe”.
“In addition, I am pleased to see a range of institutional investors who support Caledonia’s long-term vision join the share register,” he said.
