By Alois Vinga
AIM-listed mining and resource development company, Vast Resources suffered a huge blow after shares declined by 22% following the placement announcement of GBP 1,3 million to cover development expenses at its Romanian Mine.
The top miner recently raised the amount after issuing 1,22 billion shares at 0.10 pence each, effectively equivalent to a 21% discount to the 13 pence per share price as of Monday.
The company plans to make an application for the new shares to be traded on the AIM market in two tranches amid expectations that the first 445.0 million shares will become effective around January 30, with the remaining 780 million shares becoming effective on or around February 6.
The company said the net cash raised from the Placing will be used for the further development of its operating Baita Plai Mine in Romania, specifically the development of the decline to access the higher-grade ore.
“Following the positive ongoing drilling program that commenced in 2023, the Company has incorporated new data into its mine plan including the acceleration of decline development which is expected to provide a significant reduction in both underground fuel consumption and underground transportation times, which will result in substantially increased productivity.
“In addition, this development will provide accelerated access to high grades at depth versus the current working areas, and to provide the ability to maximise the value of the concentrate by enhancing the grade,” market information around the developments said.
The funds will also be used to cover nearby corporate obligations and working capital needs as well as the increased overhead in respect of the new near-term revenue-generating operations in Tajikistan.
“ Additionally, the funds raised will ensure the Company has sufficient funds available in respect of the Historic Parcel and the first shipment of the PGM concentrates as announced on 22 January 2024,” the company added.