Eurasia Mining PLC (AIM:EUA, FRA:EUH) will raise GBP11mln through a private placement with institutional investors to help finance a previously announced joint venture with Russian state-owned company Rosgeo.
Institutional investors have agreed to buy 41.55mln shares and warrants at 26 pence per share, the closing share price on September 17.
Eurasia Mining’s cash position prior to the private placement is about US$20mln (GBP14.6mln) with no debt and after significant investments made into the West Kytlim operating mines and plants expansion as well as into the Monchetundra project. Following the private placement, the company will have about US$35mln in cash.
“The directors are delighted that professional institutional investors offered to support Eurasia’s fundamentals and its strategic options, as we continue to develop the company including the upcoming acquisitions of Nyud, Moroshkovoe and other significant Rosgeo JV PGM [platinum group metals] and battery metals open pit deposits,” said executive chairman Christian Schaffalitzky.
“Furthermore, while our board and management continue to be significant shareholders, the directors are confident that the private placement will further strengthen Eurasia’s negotiating position.”
Eurasia said it received a more sizable offer, but decided to limit the size of the private placement to minimise shareholder dilution.
In March, Eurasia signed a binding agreement to create a joint venture with Rosgeo in which Eurasia will own a 75% equity stake in nine platinum group metal and battery metals assets with a total of 104.6mln ounces of platinum equivalent reserves and resources in the immediate vicinity of the Monchetundra project in the Kola Peninsula.