Rights Issue and Placement Bring $3.87M Capital Boost to Magnetite Mines

Capital Raising Success

Magnetite Mines Limited (ASX – MGT) has announced the successful completion of its renounceable pro-rata rights issue, raising approximately $2.65 million before costs. The offer was fully subscribed, reflecting strong support from existing shareholders, directors, and new investors introduced by lead manager Mahe Capital Pty Ltd. The company also received excess demand beyond the rights issue shortfall offer, prompting a follow-on placement to raise an additional $1.214 million on the same terms.

Combined, these capital raisings will inject nearly $3.87 million into Magnetite Mines, providing a significant boost to its financial position as it advances the Razorback Iron Ore Project in South Australia’s Braemar iron region.

Strategic Use of Funds

The fresh capital is earmarked to progress a binding transaction with strategic partners to secure definitive feasibility study (DFS) funding, a critical step toward project development. It will also support ongoing technical optimisation work and the approval process for the project’s mining lease proposal, including land access negotiations. Additionally, Magnetite Mines plans to continue disciplined exploration across its extensive tenement portfolio, which holds potential not only for iron ore but also for gold and critical minerals such as copper and rare earth elements.

Investor Confidence and Market Positioning

Chair Paul White highlighted the oversubscribed capital raising as a strong endorsement of the company’s strategy and the Razorback project’s potential. With detailed technical due diligence completed by Japanese steel trader JFE Shoji and ongoing commercial negotiations, Magnetite Mines is positioning itself as a future long-life producer of premium magnetite iron ore. This aligns with the global steel industry’s shift toward low-carbon steelmaking, where premium magnetite concentrates are increasingly in demand.

Managing Director Tim Dobson expressed satisfaction with the strong investor response, noting that the additional funds provide greater financial flexibility to maintain project momentum and explore broader commodity opportunities while adhering to disciplined capital management.

Conditional Placement and Shareholder Approval

The follow-on placement includes approximately 18.67 million shares and options, with around 12.3 million options subject to shareholder approval at the upcoming Annual General Meeting (AGM). Should shareholders not approve these conditional placement options, the company has committed to compensating affected investors with cash payments. This mechanism aims to balance investor interests while maintaining the company’s capital raising objectives.

New shares and options from the rights issue are expected to be issued on 5 September 2025, with trading commencing on 8 September. The follow-on placement securities are anticipated to be issued shortly thereafter.

Looking Ahead

With a strengthened balance sheet and clear strategic direction, Magnetite Mines is well-positioned to advance the Razorback Iron Ore Project through critical development phases. The company’s focus on premium magnetite production and exploration of complementary minerals could unlock additional shareholder value in the evolving resource landscape of South Australia.