| LISTED mining firm Geograce Resources Philippines Inc. has raised P557 million in net proceeds from the sale of 560.467 million common shares to existing shareholders via a stock rights offer.
A rights offer is the sale of common stock to current shareholders, who then get to buy subsequent issues at a discount from the offering price.
The shares, which were offered from May 15 to May 21, were priced at P1 a piece and would be listed at the bourse on May 25. With the stock rights offering, Geograce’s market capitalization has grown to $115 million.
Company vice president for exploration Neil Motton said Tuesday, the amount generated from the rights offering would cover its exploration costs, project development expenses, payment of shareholder advances, and additional working capital.
According to him, Geograce is currently looking at acquiring at least 12 mining tenements in various parts of the country, specifically those with potential nickel laterite deposits.
It is likewise in talks with various groups for a possible joint venture in future exploration projects.
“There is huge opportunity in the Philippine mining industry. This country has one of the biggest mining resources in the world. Geograce is very bullish in the Philippines,” said Motton.
Geograce earlier proposed to acquire mining rights amounting to approximately 31,990 hectares of nickel property through the execution of various memorandum of agreements (MOAs) with Garnierite Mining Inc. and Saprolite Mining Inc. Application for exploration permits have been filed and pending with the Mines and Geosciences Bureau.
The mining rights cover the areas of Zambales, Bukidnon and Palawan.
Meanwhile, Geograce signed a letter of intent to enter into a strategic partnership with Rusina Mining N.L. for the acquisition and development of various mining tenements and projects in the Philippines.
Last February, the company executed an offtake agreement and confidentiality agreement with Chemical Vapour Metal Refining Inc. (CVMR). Pursuant to the offtake agreement, Geograce shall supply, sell and deliver nickel ore produced at mines located in Bukidnon to CVMR. Geograce shall use all reasonable endeavors to commence production on or before January 1, 2009.
CVMR is a privately held corporation based in Canada and is engaged in mining, metal refining and vapor metallurgy process of development.
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