(Alliance News) - Danakali Ltd on Tuesday said it has received approval from the Australian Securities Exchange to halt trading in its shares in order to undertake a fundraising.
Trading on the London Stock Exchange continued, and Danakali was down 12% at 25.00 pence in London on Tuesday morning.
The Colluli potash project developer said the fundraising is being conducted in Australia and the UK. It will take place in a single tranche and will not exceed a level requiring the publication of a prospectus in the UK, resulting in a maximum capacity to issue up to 63 million shares. That would raise GBP15.8 million at the current market price.
Danakali said the proceeds will be used for early works at its Colluli sulfate of potash project in Eritrea, including site road development, geophysical investigation, reverse osmosis plant completion and installation, exploration camp relocation and RA International mine camp installation. Funds also will be used for project engineering and test work, and general working capital requirements, it added.
The UK placing is being conducted by Shore Capital as the sole bookrunner.
"The trading halt has been undertaken to assist the company in regard to the capital raising. The company expects trading in its shares to resume on the ASX on April 29 and will provide the market with an update on its capital raising in due course. Trading in the company's shares on LSE will continue during this period," said Danakali.
By Zoe Wickens; zoewickens@alliancenews.com
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