Besieged base metals miner Kagara is hopeful of enticing a copper industry player to join its share register as part of a capital raising of up to $50 million.
Kagara shares were placed in a trading halt on Friday pending details of a “proposed capital raising”.
It is understood Kagara is close to signing up a strategic investor to take a $10 million equity stake, equating to slightly more than 10 per cent of the miner’s expanded capital, as well as providing a $20 million to $25 million debt facility.
Kagara is also likely to tap existing shareholders for more cash through a share purchase plan, which could raise another $15 million.
Kagara needs to refinance $50 million of debt by next month. The miner has also been stung by provisional pricing of its Mt Garnet copper concentrate, which has left it owing the buyers $31 million. Kagara’s shares, worth $5.75 last May, traded at 42¢ before being placed in the halt.
PETER KLINGER
KZL Price at posting:
31.6¢ Sentiment: None Disclosure: Held
