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Paringa Resources secures funding required for the development of Poplar Grove Mine

Published by , Editorial Assistant
World Coal,

Paringa Resources Limited has announced that it has successfully completed a book build and received commitments for a placement of 102 million shares at an issue price of AUS$0.52 per share to Institutional and Sophisticated investors to raise AUS$53 million.

Proceeds from the Placement will be used to construct the company’s Poplar Grove Coal Mine located in the Western Kentucky region of the Illinois Basin in the US and for working capital.

The Placement completes the funding required for the development of Poplar Grove Mine and, together with the recently announced US$20 million debt facility from Macquarie Bank Limited and existing cash reserves, the company will be fully funded to develop the Poplar Grove Mine.

Paringa’s Managing Director and CEO, Mr. Todd Hannigan, said: “This successful capital raising completes the funding required for the development of the Poplar Grove Coal Mine starting July 2017. We now have a strong financial position to deliver on our plan to become a 6.6 Mtpa Illinois Basin producer – starting with construction of the low cost and high margin Poplar Grove Mine and then followed by the fully permitted, high margin Cypress Mine.”

The Directors of Paringa plan to participate in the Placement by subscribing for a total of 1.5 million shares,subject to the necessary approvals.

Argonaut acted as Lead Manager to the Placement with Hartleys Limited and Curran & Co acting as CoManagers to the Placement.

The issue price of A$0.52 represents a 16% discount to the last closing price of A$0.62 and a 7% discount to the 30-day VWAP of A$0.56.

The Placement will be completed in two tranches as follows:

  • 44.6 million shares will be issued on or about 21 April 2017 under Listing Rule 7.1 (23.2 million shares) and Listing Rule 7.1A (21.4 million shares) (following this issue the company will have no remaining issue capacity under Listing Rules 7.1 and 7.1A).
  • 57.3 million shares will be issued on or about 29 May 2017 following shareholder approval. A notice of general meeting will be sent to shareholders shortly.

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