(Alliance News) - Shares in Metals One PLC sank on Monday morning, following the completion of a discounted placing offer to finance its "cornerstone" Finnish project and the cancellation of a farm-in agreement with Gunsynd PLC.
Metals One is a battery metals explorer with projects in Finland and Norway. Shares in the company were down 25% at 1.01 pence per share in London on Monday.
Metals One said it has raised gross proceeds of GBP895,000 through a placing and subscription of 89.5 million new shares at a price of 1p each, a 17% discount to its Friday closing price of 1.20p.
The fundraise was conducted to support the development of the company's Black Schist nickel, zinc, copper and cobalt project in Finland.
The Black Schist project has existing inferred resources totalling 28.1 million tonnes, and the fundraise will allow Metals One to progress its resource upgrade programme, underpinning a scoping study in the second half of 2024.
The proceeds will also allow for the termination of Metals One's farm-in agreement with Gunsynd PLC, the company said, and provide it with the option to regain 100% ownership of its flagship Black Schist project.
In July 2023, the company reached an agreement with Gunsynd, a London-based investor, in which the latter would acquire a 25% stake in Metals One's Finnish subsidiary through four share subscriptions at GBP250,000 each.
In November, Gunsynd subscribed for the initial 6.25% tranche of voting rights in Metals One Finland.
In terminating the farm-in agreement, Metals One has been granted a three-year option to reacquire the voting rights from Gunsynd in exchange for an aggregate consideration of GBP250,000.
As part of the July agreement, Gunsynd was also granted warrants to subscribe for 1.5 million shares in Metals One. These warrants have been cancelled as part of the termination agreement.
Shares in Gunsynd were up 3.6% at 0.14 pence each following the announcement.
Metals One's Chief Executive Officer Jonathan Owen said: "The Black Schist project is the cornerstone of Metals One's ambition to build a scalable, low-cost strategic metals producing asset. Our decision to raise funds directly and replace the farm-in agreement demonstrates our confidence and that of our investors in the project's development potential."
By Hugh Cameron, Alliance News reporter
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