Mining billionaire Andrew Forrest will boost his stake in Poseidon Nickel and help fund the restart of its Silver Swan and Black Swan nickel mines 50km north-east of Kalgoorlie as part of a $75 million raising by the company.
The explorer this morning responded to a $67 million takeover offer from a US private equity firm by announcing its own recapitalisation plan backed by its major shareholder. Texas-based Black Mountain Metals has withdrawn its cash offer for Poseidon in response to the news.
Poseidon said it had raised $5.8 million in a placement and would raise a further $68.8 million in a rights issue priced at 5¢, representing a premium to the company’s last traded price.
Shareholders will have the right to subscribe for up to 11 new shares for every 10 they hold. Mr Forrest’s private company Squadron Resources took part in the placement, increasing its holding in Poseidon to 18 per cent.
Squadron will also sub-underwrite the entitlement offer, meaning Mr Forrest’s stake could increase further. Poseidon directors have agreed to subscribe for about $2.2 million worth of new shares under the rights issue.
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