Cadence Minerals (AIM:KDNC)   has raised £1.25 million through a placing of 10,416,662 new ordinary shares at 12p per share, a 21.7% discount to closing mid-price on 19 August 2020. 

Cadence intends to use the proceeds for general working capital and to provide it flexibility to repay loan notes from cash reserves rather than from its holdings in quoted investments.  

The outstanding balance on the Company’s loan notes, which were announced on 15 June 2019 and 1 August 2019, currently stands at around £1.7 million. 

Shares in Cadence Minerals have increased over the past three months and closed at 16.35p on Thursday afternoon.  

Last week, the group said it had continued to progress discussions with bank creditors as it nears completing its final stages of its investment into the Amapá iron ore project.  

The company has planned to invest in and acquire up to a 27% interest in the Amapá iron ore mine project which is located in Brazil and 100% owned by DEV Mineração S.A (DEV).   

Cadence told investors that DEV and partner Indo Sino have continued ‘a constructive dialogue’ to reach a settlement agreement with the secured bank creditors, which remains the final precondition for Cadence to be able to make its initial investment in the Amapa Project.  

On completion and on the release of the Cadence escrow monies, Cadence will become a 20% shareholder in Ampampa via its joint venture company which will own 99.9% of DEV.  

Cadence said this morning that DEV has provided the requested documentation, and continues to liaise with both the State of Amapa and SEMA (Secretaria de Estado de Meio Ambiente). 

It said it understands that SEMA will provide the required documentation imminently and following which, the Company will provide an update once the first shipment is underway. 

It is expected that at full production the Amapá Project has a mine life of 14 years and at full capacity is targeting to produce up to 5.3 Mt of iron ore per annum.  

For now, the JV partners continue to work with DEV to advance the restart of the Amapá Project using the proceeds of the iron ore, accelerating the production from the site.  

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