- Junior energy company AustChina (AUH) calls a two-day trading halt as it prepares to tap investors for some fresh funding
- The planned capital raise comes as AustChina approaches the end of its due diligence period for the potential adoption of new clean energy tech from Fortress Capital
- However, it’s still uncertain at this stage if the capital raise is related to the clean energy tech or if it’s designed to simply fund general working capital and exploration
- AustChina had around $830,000 in available funding at the end of December after posting net cash quarterly outflows of $231,000 for the quarter
- Shares in AustChina last traded for 1.7 cents each on Friday, March 11
Junior energy company AustChina (AUH) has called a two-day trading halt as it prepares to tap investors for some fresh funding.
The company is yet to announce how much it plans to raise or for what it will use the funds, but these details are set to be revealed before the company comes out of its trading halt on Wednesday, March 16.
The capital raise comes just as AustChina approaches the end of its due diligence period for the potential adoption of new technology from Fortress Capital to convert solid fuels into cleaner and environmentally responsible electricity.
AustChina first flagged its memorandum of understanding with Fortress back in October last year, with the due diligence period initially to end in January. Due to COVID-19-related delays, the companies agreed to extend this due diligence period to the end of March.
Taking a look at AustChina’s last financial report, the company had around $830,000 in available funding at the end of December after posting net cash quarterly outflows of $231,000 for the quarter. At this rate of cash burn, this gave AustChina almost a year’s worth of funding left.
As such, whether AustChina’s upcoming capital raise is designed to simply fund general working capital and exploration work or whether it is related to the memorandum of understanding with Fortress and the clean energy tech is still uncertain.
Shares in AustChina last traded for 1.7 cents each on Friday, March 11. The company has a $26 million market cap.