- Tesoro Resources (TSO) has received commitments to raise up to $21 million to support drilling and exploration at the El Zorro Gold Project in Chile
- Of the $21 million, $18 million will be raised through a placement which will issue over 66.6 million shares at 27 cents
- The issue price represents a 14.6 per cent discount to the five-day volume-weighted average price
- The remaining $3 million will be raised from a share purchase plan – allowing shareholders to apply for up to $30,000 worth of shares at 27 cents each
- Once the money has been raised, Tesoro will have over $24 million in cash reserves to underpin exploration work
- Company shares are up a slight 1.69 per cent and are trading at 30 cents
Tesoro Resources (TSO) has received firm commitments for a placement and share purchase plan to raise up to $21 million.
Placement
A total of $18 million will be raised under the placement through the issue of 66,666,667 new shares at 27 cents per share.
The issue price represents a 9.3 per cent discount to the last closing price and a 14.6 per cent discount to the five-day volume-weighted average price.
Additionally, 925,926 new shares will be issued to Tribeca, a new shareholder, in lieu of capital raising service fees.
Share purchase plan
Tesoro plans to raise a total of $3 million under the share purchase plan (SPP). Shareholders will have the opportunity to apply for up to $30,000 worth of shares at the same price as the placement.
While the company plans to cap the SPP at $3 million, it has the right to accept oversubscriptions or scale back applications.
Use of the funds
Tesoro will use the funds to support a 50,000-metre drilling program, metallurgical testwork and a scoping study at the El Zorro Gold Project in Chile.
“This is a transformational capital raising for the company. The El Zorro Gold Project is emerging as a significant new gold district, with the rapidly expanding Ternera Gold deposit being the first of six mineralised targets the company has drilled,” Managing Director Zeff Reeves said.
Once the placement and SPP have been completed, Tesoro will have over $24 million in cash reserves to underpin upcoming exploration work.
Company shares are up a slight 1.69 per cent and are trading at 30 cents at 12:576 pm AEDT.