2nd Jun 2016 14:45
(Correcting that the combination of the placing and subscription will almost triple the number of Hummingbird shares in issue.)
LONDON (Alliance News) - West African gold company Hummingbird Resources PLC said Thursday it has raised GBP45.8 million to fund the construction of its Yanfolila gold project in Mali.
Hummingbird raised the GBP45.8 million through the placing of 103.7 million shares at 22 pence each and a subscription for around 104.7 million shares at the same price, subject to shareholder approval. The placing will almost triple the number of Hummingbird shares in issue. The company's current market capitalisation is GBP25.5 million with 107.0 million shares issued.
Shares in Hummingbird were up down 6.1% to 23.70 pence following the announcement Thursday, having been up 1.0% immediately prior.
The funds will be used to complete detailed engineering, order long-lead items and begin construction at the mine.
Hummingbird said its previously announced definitive feasibility study and optimised mine plan showed the project will offer 132,000 ounces gold in its first full year of production. Total project capital expenditure is around USD80 million.
The company said that the balance of financing is expected to come from an appropriate debt facility, for which it has received "a number of expressions of interest".
"We are now in a position to commence full-scale construction in order to bring Yanfolila, one of the highest margin undeveloped gold projects in Africa, to production. This equity placement enables Hummingbird to move immediately into detailed engineering with a clear timeline to production. The company will now have a strong balance sheet and is positioned to negotiate the best possible debt terms for our shareholders," said Managing Director Dan Betts in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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