Hawsons’ Capital Raise Fuels Project Push Amid Market Uncertainties
Hawsons Iron Limited has successfully raised $1.91 million through an oversubscribed Share Purchase Plan and a targeted Placement, positioning the company to fast-track key project studies and environmental assessments.
- Share Purchase Plan raised $1.21M, exceeding $1M target
- Additional $0.7M raised via Placement at $0.017 per share
- Directors and management participated, showing strong alignment
- Funds earmarked for updated Prefeasibility Study and Maiden Ore Reserves
- Ignite Equity led the Placement with a 6% fee and options issued
Capital Raising Success
Hawsons Iron Limited (ASX, HIO) has announced the completion of a Share Purchase Plan (SPP) that raised $1.21 million, surpassing its initial $1 million target. The company’s board elected to accept all valid applications, resulting in the issuance of over 71 million shares at a discounted price of $0.017 each. This strong shareholder response underscores confidence in Hawsons’ strategic direction.
In tandem with the SPP, Hawsons completed a Placement to sophisticated and institutional investors, raising an additional $700,000 at the same share price. This combined capital raise totals $1.91 million, providing the company with a solid financial platform to advance its iron ore project.
Director and Management Alignment
Notably, Hawsons’ directors contributed $65,000 to the SPP, while management, ineligible for the SPP, invested $30,000 in the Placement. This participation signals strong alignment between the company’s leadership and its shareholders, reinforcing confidence in the project’s potential and the company’s growth trajectory.
Strategic Use of Funds
The funds raised will be directed towards critical next steps, including updating the Prefeasibility Study (PFS) and establishing Maiden Ore Reserves. These milestones are pivotal for advancing the project towards definitive feasibility. Additionally, the company plans to conduct metallurgical test work, explore potential secondary products, optimize mine design and logistics, and undertake preliminary environmental studies.
Hawsons’ CEO, Tom Revy, emphasized that the capital injection enables the company to fast-track these essential activities, aiming to complete the updated PFS and Maiden Ore Reserves by the end of the calendar year. This progress is expected to maintain momentum towards the project’s definitive feasibility study.
Placement Management and Costs
Ignite Equity acted as Lead Manager for the Placement, earning a 6% cash fee on the amount raised and receiving 700,000 options exercisable at $0.03 with an expiry in July 2028. This arrangement reflects market-standard terms and aligns the manager’s interests with the company’s future performance.
With shares issued and scheduled for quotation on the ASX imminently, Hawsons is poised to leverage this capital to unlock value and advance its iron ore project amid a competitive mining sector.
Bottom Line?
Hawsons’ successful capital raise sets the stage for critical project milestones, but investors will watch closely for the upcoming feasibility updates.
Questions in the middle?
- How will the updated Prefeasibility Study impact the project’s valuation and timeline?
- What are the potential secondary products under investigation, and how might they affect project economics?
- How will the market respond to the dilution from the new shares issued under the SPP and Placement?
