Capital Raises Weekly Wrap - 12/07/2021

In a more subdued market gold and lithium focused companies persist with the raising of capital, with all eight of the mining sector placements being run by companies with gold assets.

(ASX:LTR) and (ASX:SYA) also hold lithium assets and combined raised $90m of the $120m raised in the mining sector this week and 40% of $234m raised across the entire market. Both are seeking to catch the wave of escalating demand for battery metals, by funding the next stages of their lithium assets.

Placement Overview

*Placements are limited to those which left a trading halt between 12/07 and 16/07.

Liontown Resources Limited (ASX:LTR) raised $52m via placement with funds to be used to accelerate the development of the Company’s world-class Kathleen Valley Lithium-Tantalum Project in Western Australia (Kathleen Valley) considering strong lithium market conditions. The placement was conducted at an issue price of $0.76 which represented a 10.1% discount to the halt price and 6.6% premium on the 30 day VWAP. 

EROAD Limited (ASX/NZX:ERD) raised NZ$64.4m to assist in acquisition of 100% of Coretex Limited. The acquisition of Coretex Limited is hoped to assist EROAD’s positioning to become a bigger player in the global telematics market. The shares were issued at NZ$5.58/A$5.25 per new share which represents a 9.2% discount to the last closing price. 

Matsa Resources Limited (ASX:MAT) raised $3.38m at $0.08 per new share (including a 1 for 2 listed option exercisable at $0.17). The funds will be used to fund an aggressive exploration program at the Lake Carey Gold project including; new underground exploration at the Red October underground gold mine to expand the current resource, a drilling program at Fortitude North to test the 700m untested structure, and further drilling at the Devon Hub to build on the recent success at HE1, HE2 and HE5. The issue price of $0.08 represented 10.1% discount to the halt price and 14.4% discount to the 15 day VWAP. 

Placement Sector Breakdown

For a more detailed look at how the ASX sectors are performing check out: https://www.freshequities.com/ASX/sectors 

90 Days Post Capital Raise Performance

Looking back at how some capital raises have performed 90 day post capital raises, it takes us back to the first week of March where the market began to slow seeing 10 raises occur over the week starting on the 1st of March. In the 90 day post performance two gold exploration companies (ASX:MAG) and (ASX:KGD) have been the best performing. While (ASX: DCC) and (ASX:CI1) have fallen well below their issue price. 

The top performing:

• Magmatic Resources Limited (ASX:MAG) peaked at 95.83% 63 days post raise.

• Kula Gold Limited (ASX:KGD) peaked at 52.50% 84 days post raise.

With the worst performing:

• DigitalX Limited (ASX: DCC) -42.22% 90 days post raise.

• Credit Intelligence Ltd (ASX:CI1 -62.50% 90 days post raise.

Check out our Past Capital Raises page for more information on past transactions.