Australia's BHM launches A$90 million underwritten financing

en.Wedoany.com Reported - On August 28, Australia's Broken Hill Mines (BHM) launched a fully underwritten A$90 million equity raising to accelerate development of the Centenary and Pinnacles silver-lead-zinc projects in New South Wales. The raising comprises an A$85 million two-stage placement and an A$5 million share purchase plan, with an issue price of A$0.76 per share, representing a 10.1% discount to the August 25 closing price.

The first stage of the placement totals A$60 million and is scheduled to settle on September 3, involving approximately 79.23 million new shares. The second stage totals A$25 million, involving approximately 32.61 million shares, and remains subject to shareholder approval at a general meeting expected to be held on October 12. The share purchase plan, open to eligible shareholders in Australia and New Zealand, is also offered at A$0.76 per share, with each shareholder able to subscribe for up to A$30,000.

Proceeds will be used to build the production decline at the Centenary orebody, accelerate resource drilling, and upgrade underground infrastructure, while also supporting expansion and resource drilling at the Pinnacles mine. Centenary is located at depth beneath the producing Rasp underground mine and has not yet been mined; the Rasp processing plant has a designed annual capacity of 750,000 tonnes and can produce lead-silver concentrate and zinc concentrate.

The Pinnacles mine is located approximately 15 kilometres southwest of Broken Hill, with a mineral resource of 6 million tonnes at 10.9% zinc equivalent, comprising 4.7% zinc, 3.3% lead, and 132 grams per tonne silver. The project is planned to use a combination of open-pit and underground mining, with ore to be transported to the Rasp processing plant. Following the completion of the raising, the company will continue drilling and assess the scale of expanding Pinnacles ore feed into the existing processing system.

BHM has also signed a non-binding letter of intent with its existing zinc concentrate offtake partner to expand the Rasp zinc concentrate offtake to up to 200,000 tonnes and secure working capital facilities of up to US$30 million, with a proposed interest rate of the secured overnight financing rate plus 3.5%. The parties plan to finalise formal documentation within 90 days, with the final facility size, drawdown conditions, and repayment arrangements still to be determined.