The graphite explorer finalised its one-for-10, non-renounceable entitlement issue on Monday, July 5, with new shares slated for issue on July 12 and quotation to occur the following day.
During the raise, shareholders subscribed for just over 20 million of the 38 million shares on offer, raising slightly more than A$4 million.
Walkabout’s entitlement offer was underwritten, meaning a suite of shareholder underwriters — including the company chairperson — will pick up more than 18 million shortfall shares between them to raise the full A$7.6 million.
The cash injection will primarily cover US$4 million in stage two companion equity required to develop Walkabout’s Lindi Jumbo Graphite Mine in Tanzania.
“Critical capital raising”
Walkabout Resources CEO Andrew Cunningham said: “We are grateful for the continued strong support of our shareholders in this critical capital raising.
“The bulk of these funds will be deployed as part of the companion equity for Lindi Jumbo development in the coming weeks and months.
“Importantly, it also represents another third of the equity contribution required to meet the major condition precedent of the US$20m in project debt from CRDB Bank.”
Fresh capital to support growth
Walkabout’s entitlement offer forms part of a broader plan to secure equity that will help the company fund the Lindi Jumbo Graphite Mine to production.
Back in April, the graphite explorer struck up a US$20 million debt funding facility with Tanzanian CRDB Bank PLC to cover 62.5% of the US$32 million in expenses associated with developing the Tanzanian graphite mine.
However, in order to access the funding parcel, Walkabout was required to secure US$12 million in companion equity, which it set out to raise over May and June.
First, Walkabout raised $6.4 million via a staged placement in May, offering institutional investors the chance to buy in at 20 cents per share.
Then, the company set out to secure up to $7.6 million via an entitlement issue, which closed on Monday and will raise the full amount with underwriter support.
Finally, in late June, Walkabout drummed up an institutional placement with US battery minerals investor Battery Metals Capital Group LLC (BMCG).
Under this offer, BMCG committed to provide up to US$6 million over two tranches and provide a further US$4 million within 10 months at the ASX-lister’s discretion.
All in all, these capital raising initiatives have provided sufficient funding for Walkabout to meet the US$12 million in companion equity requirements to access the CRDB Bank facility and fully fund Lindi Jumbo to production.