- Mining company AuStar Gold (AUL) has closed a recent pro-rata entitlement offer which it held for its eligible shareholders
- The company offered around 4.25 million securities on a one-for-ten basis at 30 cents per share for proceeds up to approximately $1.27 million
- AuStar only received applications for around 2.73 million shares under the offer, raising just over $818,000 in proceeds
- However, the company did receive applications for shares under the shortfall facility, prompting a scale-back process by the board
- AuStar shares steady on the market this morning, currently trading for 34 cents
Mining company AuStar Gold (AUL) has closed a recent pro-rata entitlement offer which it held for its eligible shareholders.
Under the entitlement, the company offered 4,251,377 securities on a one-for-ten basis, at 30 cents per share.
This was accompanied by the offer of one free attaching option for every three shares subscribed for, resulting in potential proceeds of up to $1,275,413.
However, AuStar only received applications for 2,727,640 shares, representing approximately 64.15 per cent of the available entitlements. This resulted in the company raising only $818,291.90 in proceeds through the offer.
That said, AuStar did receive substantial applications for $1,222,919.70 in shares under the top-up or shortfall facility.
As a result of the significant excess of demand for shares under the top-up facility, the company’s Board of Directors will now undertake a scale-back process.
The company will communicate the outcomes of this scale-back process to participants soon. The allotment of securities under the entitlement offer is scheduled to occur today.
While the amount of money raised under the entitlement offer is not as much as hoped, the funds may still be put to good use. Recent attempts by the company to raise capital have been for the purpose of funding the expansion of its Morning Star Gold mine.
In an announcement about the entitlement offer, AuStar Gold expressed its gratitude to those shareholders who took part.
“The company wishes to thank all shareholders for their ongoing support of the company, and in particular those who participated in the recent entitlement offer,” the announcement read.
AuStar shares steady on the market this morning, trading for 34 cents at 10:25 am AEDT.