Tasman Resources Launches $3.68M Rights Issue to Fund Key Drilling Program

Tasman Resources' Capital Raise Strategy

Tasman Resources Limited (ASX: TAS) has unveiled a renounceable pro-rata rights issue designed to raise approximately $3.68 million before expenses. The offer invites qualifying shareholders in Australia and New Zealand to subscribe for one new share for every share held as of 21 May 2025, priced at $0.02 per share. Additionally, shareholders will receive one free option for every two new shares subscribed, exercisable at $0.05 within three years.

Purpose and Use of Funds

The capital raised will primarily fund a new drilling program at Tasman’s 100% owned Parkinson Dam project in South Australia. This initiative targets six geophysical anomalies identified in recent surveys, aiming to explore for Iron Oxide Copper Gold (IOCG), Epithermal, or Porphyry-style mineralisation. The program builds on earlier drilling campaigns from 2005 to 2009, which encountered significant mineralisation but did not define a commercial deposit.

Beyond exploration, proceeds will support general working capital and the repayment of shareholder loans. Notably, the company’s two largest shareholders, Arkenstone Pty Ltd and March Bells Pty Ltd, intend to fully subscribe to their entitlements by applying outstanding loans owed by the company, effectively reducing Tasman’s debt by approximately $1.68 million.

Offer Mechanics and Shareholder Impact

The rights issue is renounceable, allowing shareholders to sell their rights on the ASX between 20 and 26 May 2025 if they choose not to participate. The offer is not underwritten, meaning full subscription is not guaranteed. If the rights issue is fully subscribed, the total shares on issue will double to approximately 368 million, with new options increasing to over 92 million.

Shareholders who fully participate will maintain their proportional ownership, while those who do not will face dilution. The two largest shareholders currently hold 22.88% each and could increase their stakes up to 31.39% if they alone subscribe fully. However, the company has structured the offer to mitigate excessive concentration by encouraging broad participation and offering shortfall shares to qualifying shareholders and sophisticated investors.

Risks and Market Context

As a junior explorer, Tasman faces inherent risks including ongoing operating losses, exploration uncertainty, and reliance on capital markets for funding. The company also holds a significant 33.92% stake in Eden Innovations Ltd, an ASX-listed entity developing advanced concrete admixtures and dual fuel systems, which is currently unprofitable and adds an additional layer of investment risk.

The new options issued will not be quoted on the ASX and may lapse worthless if the share price does not exceed the exercise price within three years. Market conditions, commodity price volatility, and regulatory factors remain critical variables influencing Tasman’s future prospects.

Next Steps for Investors

Qualifying shareholders should carefully consider the offer details, including the speculative nature of the investment and associated risks. The company encourages shareholders to consult professional advisers before subscribing. The rights issue timetable is tight, with the offer closing on 2 June 2025 and new shares expected to be issued by 5 June 2025, subject to ASX approval.