Sale prices alongside A$9.54 million non-renounceable rights offering
By Devika Patel
Knoxville, Tenn., July 27 - Kimberley Metals Ltd. said it will sell A$3.8 million of 10% convertible notes in a private placement, for which it has already received brokers commitments of more than A$3 million. The company also plans to sell A$9.54 million of these convertibles in a non-renounceable rights offering.
The 10 million five-year notes sold in the placement will have a face value of A$0.38 each. They will be convertible into shares on a 1 for 1 basis and may be called after two years.
The company will sell 25,114,127 convertibles in the rights offering to Australian and New Zealand shareholders on the basis of 1 note for each 6 shares held on the record date of Aug. 10.
Proceeds will be used to accelerate exploration and development activities at the company's copper-gold-silver mine and at its emerging silver-lead asset.
"We plan to accelerate gold and silver production at Mineral Hill Mine and will seek to extend the high grade copper reserves as well as introduce silver-lead-zinc concentrate production. We see potential to increase the Reserves and Resources at Mineral Hill and this funding will enable us to start pursuing attractive targets at Parkers Hill, the Southern Ore Zone and Pearse," chairman Jim Wall said in a press release.
"Whilst Mineral Hill Mine is now emerging, we also want to bring the Sorby Hills project into production in 2013 and fresh drilling and geological interpretation of the substantial silver project at Manbarrum, 30 kilometers east of the Sorby Hills could add an important new dimension. Hence we aim to generate a new Indicated Resource estimate for the project and materially extend the precious metals production of the combined Sorby Hills/Manbarrum projects," Wall said.
"These initiatives would otherwise have to be deferred until sufficient cash flows are available from copper concentrate production at Mineral Hill. First cash flow from Mineral Hill Mine is still on track for the September 2011 quarter," Wall said in the release.
Kimberley Metals is a copper, gold, silver, lead and zinc exploration company based in Sydney, Australia.
| Issuer: | Kimberley Metals Ltd.
|
| Issue: | Convertible notes
|
| Amount: | A$3.8 million
|
| Maturity: | Five years
|
| Notes: | 10 million
|
| Price: | Par of A$0.38
|
| Coupon: | 10%
|
| Conversion ratio: | 1 for 1 basis
|
| Call: | After two years
|
| Warrants: | No
|
| Pricing date: | July 27
|
| Stock symbol: | Australia: KBL
|
| Stock price: | A$0.32 at close July 27
|
| Market capitalization: | A$59.14 million
|
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