LONDON (Alliance News) - South Africa-focused thermal coal exploration and development company Coal of Africa Ltd on Friday said it expects to complete the third stage of its share placement, when it will issue 144 million shares, by April.
Last year, Coal of Africa shareholders approved a two stage equity placement for the issue of up to 695 million shares for GBP0.055 per share, which was first thought to raise around USD64.9 million, but due to exchange rates was later revised down to around USD60 million. However, last month, the company announced that it had agreed with all participants in its equity placement to split the second stage of the placement into two parts.
The company's shares were down 0.9% at 1.73 pence mid-morning Friday.
The required regulatory approvals for stage one were received during November, resulting in the issue of 295 million new shares.
The first part of the second stage of the equity placement was completed during December with the issue of 300 million shares, while the the third stage is anticipated to be completed by April 2015.
That would result in a total of 739 million shares issued overall for the three stage equity placement, which would raise GBP40.6 million, currently about USD61.3 million.
"The third stage of the placement process is expected to be completed during April 2015, resulting in a successful capital raise in what are considered to be very tough market conditions for mining companies, especially junior mining companies," said Chief Executive Officer David Brown in a statement.
"The funds raised will be utilised to settle historic obligations and progress the company's projects which are at various stages of exploration and development," he added.
Earlier this week, the company's shares were given a boost after it said South African authorities had granted an amendment to the environmental authorisation for the Vele Colliery, bringing the project closer to fruition. The amendment is the first of several needed in relation to the planned modifications to the Vele plant and marks a further step towards the site achieving the full regulatory compliance needed for construction to begin.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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