On 29 March 2021, Strandline Resources Limited (ACN 090 603 642) (Strandline or the Company) announced a fully underwritten institutional placement (Placement) and an accelerated non-renounceable entitlement offer to raise up to approximately A$122 million (before costs).
The accelerated non-renounceable pro rata entitlement offer will be on the basis of one new fully paid ordinary share (New Share) for every 1.3 fully paid ordinary shares in the Company (Share) held by eligible shareholders as at 7.00pm (Sydney time) on 31 March 2021 (Record Date) at an issue price of A$0.205 per New Share to raise up to approximately A$83 million (before costs) (Entitlement Offer).
This letter is to inform you about the Entitlement Offer, and to explain why you will not be able to subscribe for New Shares under the Entitlement Offer. You should read this letter carefully to understand what this means for you. This letter is not an offer to issue New Shares to you, nor an invitation for you to apply for New Shares. You are not required to do anything in response to this letter.
The Entitlement Offer is fully underwritten and comprises of an offer to eligible institutional shareholders which was conducted on an accelerated basis (Institutional Entitlement Offer) and an offer to Eligible Retail Shareholders (as defined below) (Retail Entitlement Offer). The Institutional Entitlement Offer raised approximately A$35 million (including the Institutional Entitlement Offer shortfall), and the Retail Entitlement Offer is expected to raise approximately A$47 million. A total of approximately 402 million New Shares will be issued (subject to rounding) under the institutional and retail components of the Entitlement Offer.
Shaw and Partners Limited (Shaws) and Morgans Corporate Limited (Morgans) (together, the Joint Lead Managers) have agreed to underwrite and joint lead manage the Entitlement Offer.
An institutional bookbuild process was conducted by the Joint Lead Managers on behalf of the Company during the offer period for the Institutional Entitlement Offer under which New Shares not taken up through the Institutional Entitlement Offer, and New Shares that would have been offered to ineligible shareholders, if they had been eligible to participate in the Entitlement Offer, were offered to institutional investors (Institutional Shortfall Bookbuild).
The proceeds of the Entitlement Offer and Placement will be used to enable Strandline to commence development of its Coburn Mineral Sands Project, with construction expected to ramp-up immediately after a Final Investment Decision anticipated in April 2021.
The Retail Entitlement Offer is being made by way of an offer document in accordance with section 708AA of the Corporations Act 2001 (Cth) (Corporations Act) (as modified by ASIC Corporations (Non-Traditional Rights Issues) Instrument 2016/84) (Offer Document), meaning that no prospectus needs to be prepared. The Institutional Entitlement Offer and Institutional Shortfall Bookbuild were conducted between 29 March 2021 and 30 March 2021.
The Entitlement Offer is non-renounceable which means that entitlements to participate in the Entitlement Offer cannot be sold or transferred. The Offer Document in relation to the Retail Entitlement Offer was lodged with ASX on 7 April 2021 and is expected to be despatched to eligible retail shareholders on the same date.
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