Metro Mining to raise US$17.5 million through a share placement

Metro Mining Ltd. has received an approval for a trading halt as it sets a target to raise US$17.5 million through a share placement priced at 20 cents. Funding from the placement is likely to boost Metro’s working capital position during production ramp-up and product sale negotiations while increasing balance sheet strength and flexibility.

Earlier this month, on having the first two shipments of bauxite successfully arrived in China, Metro Mining received the first payment from off-take partner Xinfa Group. Xinfa is one of China’s largest integrated aluminium companies, with significant refining and smelting operations across multiple provinces.

With successful delivery of the shipments to Xinfa as planned, Metro experienced increasing buying interest for bauxite from its Bauxite Hills Mine in north Queensland. Production ramped up as a result and is likely to continue.

Bauxite shipped in the June quarter is expected to reach the lower end of previously stated guidance. Furthermore, guidance for bauxite shipped during the upcoming September and December quarters has been revised upwards. Recruitment for the site is largely complete as well, with indigenous employees comprising of approximately 34 per cent of the total workforce.

The share placement aims to raise about US$15 million for the company, with the ability to take oversubscriptions of an additional US$2.5 million.

The lead manager has received pre-commitments above US$10 million.