Strategic Minerals hits 12-month low after discount fundraising

Shares in Strategic Minerals took a dive late on Thursday morning after the company issued a swathe of new shares at a massive discount. The AIM-listed magnetite iron ore producer and explorer raised approximately £1m before expenses from new investors at the price of 0.8p, with the shares having closed the previous day at 1.13p.Strategic Minerals also issued a 45m other shares owed to Glencore.The new funds raised will be used primarily for working capital purposes.Executive Chairman James Fyfe said: "Our group overhead reductions mean that we expect our ongoing corporate costs to be fully covered by our operating business in New Mexico, which favourably positions the company as it seeks to add new operating assets to its portfolio."Management have also undertaken a review into operations, resulting in the streamlining of its corporate overheads and significant savings, estimated to be approximately £650,000 on an annualised basis as compared to fiscal 2013. It said these cost savings were expected to come into effect from the second quarter of the year. Shares in the company were down 25.7% to 0.84 on the news, a new 12-month low.OH