KEFI Gold and Copper (KEFI ) is raising £34 million via a placing of shares at 1.2p each. 

A concurrent separate retail offering will be opened shortly, with a view to raising an additional £1 million. 

The company is also taking the opportunity to settle outstanding fees totalling approximately £853,000 via a subscription.

The net proceeds will be utilised by KEFI to complete and optimise project financing for the Tulu Kapi project in Ethiopia, to fund exploration activities, to fund a cost overrun cash reserve and for general working capital purposes. 

The total proceeds raised by KEFI to fund the Tulu Kapi project following completion of the placing will be approximately US$355 million, which exceeds the anticipated US$330 million total project capital cost.

Stifel Nicolaus Europe and Tavira Financial are acting as joint bookrunners for the placing, while retail investors can participate through the RetailBook platform.

 "Today's capital raising not only wraps up the Tulu Kapi development funding but does so in a manner which replaces some higher cost capital,” said KEFI’s executive chairman, Harry Anagnostaras-Adams.

“Importantly, it also provides the required funding to re-initiate strategic exploration, both at Tulu Kapi and more widely, and expands the institutional participation in our share register - important for our intended transition to the main market of the London Stock Exchange in due course."

 

View from Vox

 

KEFI’s shares have been riding high in recent weeks, so it’s a good time to dip into the market for the final tranche of funds required to get Tulu Kapi built. It’s a big bite out of the headroom, though, as the new shares will represent approximately 28% of the issued share capital. Accordingly, the shares will be issued in two tranches, with shareholder approval required for the second, and a general meeting is expected to be held around 14 April for this purpose. That’ll be an interesting meeting to attend, as KEFI has been one of the standout success stories in the recent gold bull market, even though some shareholders have grumbled about delays. But, assuming shareholders approve, KEFI will have more than enough money in place to fund construction at Tulu Kapi from start to finish. It’s also noteworthy that new institutions have expressed interest and are coming on board.