10th Dec 2019 14:28
(Alliance News) - Danakali Ltd on Tuesday said it has secured the proceeds of the first tranche of USD50 million strategic equity investment from Africa Finance Corp.
Africa Finance's investment is part of the overall funding package for development and construction of the Colluli sulphate of potash project, located in Eritrea, east Africa.
On Tuesday last week, Dakanali has entered into a subscription agreement with Africa Finance for issuing new shares.
The Sydney and London-listed potash explorer said the first tranche consists of 53 million new shares in Danakali, issued to Africa Finance, at a price of AUD0.60 per share to raise USD21.5 million.
The stock was trading 3.8% higher in London on Tuesday afternoon at 37.90 pence a share. In Sydney, the shares closed up 1.6% at AUD0.64 each.
Dakanali explained that these proceeds will be used to commence Colluli project execution.
The second tranche, which is subject to Danakali shareholder approval and execution of senior debt documentation, will consist of 70 million new shares at the same issue price to raise the remaining AUD42.0 million.
Following the investment, Africa Finance will own a 32% stake in Danakali.
By Evelina Grecenko; [email protected]
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