Adavale Resources (ASX:ADD) set to raise $1.8m for exploration and drilling

• Adavale Resources (ADD) receives binding commitments to raise $1.8 million via a share placement
• The funds will be raised through the issue of more than 90 million new fully-paid ordinary shares to new sophisticated investors at a price of two cents each
• Adavale will also be launching a one-for-six non-renounceable entitlement offer to raise a further $1.2 million
• The money from the placement and entitlement offer will be used to accelerate nickel exploration activities in Tanzania and uranium drilling in South Australia
• Shares in Adavale are up two per cent on the market and are trading at 2.6 cents at 12:47 pm AEST

Adavale Resources (ADD) has received binding commitments to raise $1.8 million via a share placement.

The funds will be raised through the issue of 90,045,411 new fully-paid ordinary shares to new sophisticated investors at a price of two cents each.

This price represents a 16.7 per cent discount to Adavale’s closing price of 2.4 cents on July 22 and an 18.7 per cent discount to the five-day volume-weighted average price of 2.46 cents.

The placement will be undertaken in two phases with phase one set to raise $1.6 million via the issue of 80,045,411 shares.

Phase two, which is subject to shareholder approval, will raise $200,000 through the issue of 10 million shares to Adavale Director and cornerstone investors.

Adavale will also be launching a one-for-six non-renounceable entitlement offer to raise a further $1.2 million.

Up to 59.6 million shares will be issued at the same price as the placement of two cents.

Under both the placement and entitlement offer, participants will receive one unlisted attaching option for every three new shares subscribed for, exercisable at three cents with expiry 12 months from approval.

Further, subject to shareholder approval, Adavale intends to undertake a one-for-10 loyalty option to all eligible shareholders on or around late September.

These options will have the same expiry date and exercise price of the attaching options.

Adavale will use the money from the placement and entitlement offer to accelerate nickel exploration activities in Tanzania and uranium drilling in South Australia.

“The funding allows Adavale to accelerate the exploration programs to unlock the potential on both our nickel and uranium projects especially following the recent ground gravity survey success,” Executive Director David Riekie commented.

Shares in Adavale were up two per cent on the market and were trading at 2.6 cents at 12:47 pm AEST.