TIDMCCZ
RNS Number : 8124A
Castillo Copper Limited
04 June 2021
04 June 2021
CASTILLO COPPER LIMITED
("Castillo" or the "Company")
Castillo raises GBP6.4m to ramp up developing Mt Oxide and
Zambia Projects
Castillo Copper Limited (LSE and ASX: CCZ), a base metal
explorer primarily focused on copper across Australia and Zambia,
is delighted to announce that it has successfully raised A$11.7m
(GBP6.4m) before costs from institutional and sophisticated
investors in Australia and the UK. This funding will enable
Castillo to accelerate developing the core Mt Oxide and key Zambia
Projects which aligns with its strategic intent to transform into a
mid-tier copper group.
Highlights
-- Ample funding, A$11.7m (GBP6.4m) before costs, has been
secured to rapidly progress developing core projects in Australia
and Zambia
-- Pleasingly, the Placement was well supported by current and
new institutional and sophisticated investors in Australia and the
UK
-- Work will shortly commence on a comprehensive drilling
campaign across three priority prospects within the flagship Mt
Oxide Project in the Mt Isa copper-belt:
o Big One Deposit - A 26 drill-hole campaign for 2,828m has been
finalised and is designed to extend known mineralisation proximal
to the 1,200m strike event
o Arya and Sansa Prospects - An expanded programme is now being
formulated to fully drill-test all known shallow and deep bedrock
conductors
-- Notably, there has been a significant resurgence of interest
in the Mt Isa copper-belt which reflects several positive factors,
including:
o Prevailing copper price, near 10-year highs, due to global
concerns regarding forward demand - driven by green stimulus and
greater take-up of electric vehicles - will create a persistent
supply deficit; and
o Upcoming IPO of 29Metals on the ASX - owner of the operating
Capricorn Copper Mine circa 7km south-west of the Mt Oxide Project
- within the next few weeks
-- Across Zambia's copper-belt, development work will focus on
advancing the Luanshya and Mkushi Projects which have definitive
surface anomalies and are proximal to producing copper mines
-- Castillo will issue 278,395,961 New Shares at a price of
$0.042 (GBP0.023) per share, representing an 11% discount to the
last 15-day trading VWAP, and one free attaching listed option for
every 2 New Shares subscribed for, exercisable at A$0.08
(GBP0.044), expiring 12 July 2024
Simon Paull, Managing Director of Castillo Copper, said: "Due to
strong demand from current and new institutional investors in
Australia and the UK, we now have ample funds to ramp up our
exploration efforts. Over the next few months, we will test-drill
multiple copper targets across the Big One Deposit, Arya and Sansa
Prospects within our core Mt Oxide Project. Concurrently, we intend
to expedite exploration programmes at the Luanshya and Mkushi
Projects in Zambia. The Board now has significantly higher
confidence that 2021 will be a transformative year for Castillo
Copper."
DEVELOPING A MID-TIER COPPER GROUP
With adequate funding now secured, Castillo is well positioned
to deliver on its strategic intent to transform into a mid-tier
copper group. The immediate priority is to accelerate developing
the flagship Mt Oxide Project in Queensland's copper-belt and,
concurrently, the Luanshya and Mkushi Projects across Zambia's
copper-belt.
Drilling commencing at Mt Oxide Project
With all logistics now in place, work is set to start on a
comprehensive drilling campaign at three prospects within the Mt
Oxide Project:
o Big One Deposit - A 26 drill-hole campaign for 2,828m has been
finalised and designed to extend known mineralisation proximal to
the 1,200m strike event; and
o Arya and Sansa Prospects - An expanded programme is now being
formulated to fully drill-test all known shallow and deep bedrock
conductors.
There has been a significant resurgence of interest in the Mt
Isa copper-belt, especially with the copper price at near 10-year
highs. In addition, the upcoming listing of high-profile 29Metals
on the ASX, which owns the producing Capricorn Copper Mine circa
7km south-west of the Mt Oxide Project, has had a positive
impact.
Zambia
Across Zambia's copper-belt, the primary focus will be on
advancing the Luanshya and Mkushi Projects which are proximal to
producing copper mines. In addition, significant surface sampling
has enabled sizeable anomalous areas to be defined which should
facilitate identifying test-drill targets once a geophysics
campaign has been completed.
PLACEMENT TERMS
The Placement was taken up by current and new sophisticated and
institutional investors from Australia and the UK raising circa
A$11.7m (GBP6.4m) before costs. The lead broker and manager to the
Placement was CPS Capital Group Pty Ltd. Brokerage fees in relation
to the Placement were on standard commercial terms and can be seen
in the Appendix 3B released to the ASX today. The Placement was not
under written.
Castillo will issue a total of 278,395,961 New Shares at $0.042
(GBP0.023) per share. 140,592,523 New Shares will be issued using
the Company's existing 7.1 capacity, 97,502,707 New Shares will be
issued using the Company's existing 7.1A capacity and 40,300,731
New Shares will be issued upon obtaining shareholder approval in a
General Meeting to be called in due course.
Castillo will issue a total of 157,041,087 Listed Options, all
of which are subject to shareholder approval which will be sought
at the above-mentioned general meeting, on the following terms:
- 14,425,063 Broker options: Strike $0.08 strike, Expiry 12 July 2024 (1)
- 3,418,043 Broker options: Strike GBP0.044 strike, Expiry 12 July 2024 (2)
- 109,523,808 Free attaching options: Strike $0.08 strike, Expiry 12 July 2024 (1)
- 28,483,696 Free attaching options: Strike GBP0.044 strike, Expiry 12 July 2024 (2)
- 1,190,477 Director options: Strike $0.08 strike, Expiry 12 July 2024 (1)
(1) Refer to Appendix A for term and conditions of the options
(2) Refer to Appendix B for term and conditions of the options
The Placement price per share of $0.042 (GBP0.023) represents an
11% discount to the last 15-day trading VWAP of $0.047
(GBP0.026).
Next Steps
-- Commence drilling at the Big One Deposit and finalise
test-drill targets for the Arya and Sansa Prospects within the Mt
Oxide Project.
In addition to this release, a PDF version of this report with
supplementary information can be found on the Company's website:
https://castillocopper.com/investors/announcements/
Appendix 3B
Castillo advises that an Appendix 3B has been issued to the
Australian Securities Exchange ("ASX") and is available on the
Company's website :
https://castillocopper.com/investors/announcements/
For further information, please contact:
Castillo Copper Limited +61 8 6558 0886
Simon Paull (Australia), Managing Director
Gerrard Hall (UK), Director
SI Capital Limited (Financial Adviser and
Corporate Broker) +44 (0)1483 413500
Nick Emerson
Luther Pendragon (Financial PR) +44 (0)20 7618 9100
Harry Chathli, Alexis Gore, Joe Quinlan
About Castillo Copper
Castillo Copper Limited is an Australian-based explorer
primarily focused on copper across Australia and Zambia. The group
is embarking on a strategic transformation to morph into a mid-tier
copper group underpinned by its core projects:
-- The Mt Oxide project in the Mt Isa copper-belt district,
north-west Queensland, which delivers significant exploration
upside through having several high-grade targets and a sizeable
untested anomaly within its boundaries in a copper-rich region.
-- Four high-quality prospective assets across Zambia's
copper-belt which is the second largest copper producer in
Africa.
-- A large tenure footprint proximal to Broken Hill's
world-class deposit that is prospective for
zinc-silver-lead-copper-gold.
-- Cangai Copper Mine in northern New South Wales, which is one
of Australia's highest grading historic copper mines.
The group is listed on the LSE and ASX under the ticker
"CCZ."
Competent Person Statement
The information in this report that relates to Exploration
Results for "Mt Oxide Project" is based on information compiled or
reviewed by Mr Mark Biggs. Mr Biggs is both a shareholder and
director of ROM Resources, a company which is a shareholder of
Castillo Copper Limited. ROM Resources provides ad hoc geological
consultancy services to Castillo Copper Limited. Mr Biggs is a
member of the Australian Institute of Mining and Metallurgy (member
#107188) and has sufficient experience of relevance to the styles
of mineralisation and types of deposits under consideration, and to
the activities undertaken, to qualify as a Competent Person as
defined in the 2012 Edition of the Joint Ore Reserves Committee
(JORC) Australasian Code for Reporting of Exploration Results, and
Mineral Resources. Mr Biggs holds an AusIMM Online Course
Certificate in 2012 JORC Code Reporting. Mr Biggs also consents to
the inclusion in this report of the matters based on information in
the form and context in which it appears.
APPIX A: AUSTRALIAN LISTED OPTIONS - RIGHTS ATTACHING
The New Options intended to be granted under this Placement will
be granted under the following terms and conditions:
Entitlement
The New Options entitle the holder to subscribe for one Share
upon exercise of each New Option.
Exercise Price and Expiry Date
The New Options have an exercise price of $0.08 (Exercise Price)
and an expiry date of 5.00pm (WST) on 12 July 2024 (Expiry
Date).
Exercise Period
The New Options are exercisable at any time on or prior to the
Expiry Date. If a New Option is not exercised before the Expiry
Date it will automatically lapse (and thereafter be incapable of
exercise).
Notice of Exercise
The New Options may be exercised by notice in writing to the
Company (Notice of Exercise) and payment of the Exercise Price for
each New Option being exercised.
Exercise Date
A Notice of Exercise is only effective on and from the later of
the date of receipt of the Notice of Exercise and the date of
receipt by the Company as cleared funds of the payment of the
Exercise Price for each New Option being exercised in cleared funds
(Exercise Date).
Shares issued on exercise
Shares issued on exercise of the New Options rank equally with
the then issued shares of the Company .
Quotation of Shares on exercise
Application will be made by the Company to ASX for quotation of
the Shares issued upon the exercise of the New Options.
Timing of issue of Shares
Within 15 Business Days after the later of the following:
(i) the Exercise Date; and
(ii) when excluded information in respect to the Company (as
defined in section 708A(7) of the Corporations Act) (if any) ceases
to be excluded information,
(iii) the Company will:
(iv) allot and issue the Shares pursuant to the exercise of the
New Options;
(v) if required, give ASX a notice that complies with section
708A(5)(e) of the Corporations Act or lodge a prospectus with ASIC
that qualifies the Shares for resale under section 708A(11) of the
Corporations Act; and
(vi) apply for Official Quotation on ASX of Shares issued
pursuant to the exercise of the New Options.
Participation in new issues
There are no participation rights or entitlements inherent in
the New Options and New Option holders will not be entitled to
participate in new issues of capital offered to Shareholders during
the currency of the New Options. However, the Company will ensure
that for the purposes of determining entitlements to any such
issue, the record date will be at least five Business Days after
the issue is announced. This will give New Option holders the
opportunity to exercise their New Options prior to the date for
determining entitlements to participate in any such issue.
Adjustment for bonus issue of Shares
If the Company makes a bonus issue of Shares or other securities
to existing Shareholders (other than an issue in lieu or in
satisfaction of dividends or by way of dividend reinvestment):
(i) the number of Shares which must be issued on the exercise of
a New Option will be increased by the number of Shares which the
New Option holder would have received if the Optionholder had
exercised the New Option before the record date for the bonus
issue; and
(ii) no change will be made to the Exercise Price.
Adjustment for rights issue
If the Company makes an issue of Shares pro rata to existing
Shareholders there will be no adjustment of the Exercise Price of a
New Option.
Adjustment for reorganisation
If there is any reconstruction of the issued share capital of
the Company, the rights of the New Options may be varied to comply
with the Listing Rules which apply to the reconstruction at the
time of the reconstruction.
Quotation of New Options
The Company will apply for Official Quotation of the New Options
on ASX.
Options transferable
If the New Options do not become listed Options, then they are
transferable provided that the transfer of the New Options complies
with section 707(3) of the Corporations Act. Should the New Options
become listed Options in accordance with paragraph above, the New
Options will be transferable in accordance with relevant market
rules.
APPENDIX B: UK LISTED OPTIONS - RIGHTS ATTACHING
The New Options intended to be granted under this Placement will
be granted under the following terms and conditions:
Entitlement
The New Options entitle the holder to subscribe for one Share
upon exercise of each New Option.
Exercise Price and Expiry Date
The New Options have an exercise price of GBP0.044 (Exercise
Price) and an expiry date of 5.00pm (WST) on 12 July 2024 (Expiry
Date).
Exercise Period
The New Options are exercisable at any time on or prior to the
Expiry Date. If a New Option is not exercised before the Expiry
Date it will automatically lapse (and thereafter be incapable of
exercise).
Notice of Exercise
The New Options may be exercised by notice in writing to the
Company (Notice of Exercise) and payment of the Exercise Price for
each New Option being exercised.
Exercise Date
A Notice of Exercise is only effective on and from the later of
the date of receipt of the Notice of Exercise and the date of
receipt by the Company as cleared funds of the payment of the
Exercise Price for each New Option being exercised in cleared funds
(Exercise Date).
Shares issued on exercise
Shares issued on exercise of the New Options rank equally with
the then issued shares of the Company .
Quotation of Shares on exercise
Application will be made by the Company to ASX for quotation of
the Shares issued upon the exercise of the New Options.
Timing of issue of Shares
Within 15 Business Days after the later of the following:
(i) the Exercise Date; and
(ii) when excluded information in respect to the Company (as
defined in section 708A(7) of the Corporations Act) (if any) ceases
to be excluded information,
the Company will:
(iii) allot and issue the Shares pursuant to the exercise of the
New Options;
(iv) if required, give ASX a notice that complies with section
708A(5)(e) of the Corporations Act or lodge a prospectus with ASIC
that qualifies the Shares for resale under section 708A(11) of the
Corporations Act; and
(v) apply for Official Quotation on ASX of Shares issued
pursuant to the exercise of the New Options.
Participation in new issues
There are no participation rights or entitlements inherent in
the New Options and New Option holders will not be entitled to
participate in new issues of capital offered to Shareholders during
the currency of the New Options. However, the Company will ensure
that for the purposes of determining entitlements to any such
issue, the record date will be at least five Business Days after
the issue is announced. This will give New Option holders the
opportunity to exercise their New Options prior to the date for
determining entitlements to participate in any such issue.
Adjustment for bonus issue of Shares
If the Company makes a bonus issue of Shares or other securities
to existing Shareholders (other than an issue in lieu or in
satisfaction of dividends or by way of dividend reinvestment):
(i) the number of Shares which must be issued on the exercise of
a New Option will be increased by the number of Shares which the
New Option holder would have received if the Optionholder had
exercised the New Option before the record date for the bonus
issue; and
(ii) no change will be made to the Exercise Price.
Adjustment for rights issue
If the Company makes an issue of Shares pro rata to existing
Shareholders there will be no adjustment of the Exercise Price of a
New Option.
Adjustment for reorganisation
If there is any reconstruction of the issued share capital of
the Company, the rights of the New Options may be varied to comply
with the Listing Rules which apply to the reconstruction at the
time of the reconstruction.
Quotation of New Options
The Company will apply for Official Quotation of the New Options
on ASX.
Options transferable
If the New Options do not become listed Options, then they are
transferable provided that the transfer of the New Options complies
with section 707(3) of the Corporations Act. Should the New Options
become listed Options in accordance with the paragraph above, the
New Options will be transferable in accordance with relevant market
rules.
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