Beacon Hill to raise up to $25m

BEACON Hill Resources plans to raise up to $US25 million from investors via a share placing.

Staff Reporter

The AIM and ASX dual-listed company went into a trading halt on the ASX this morning following the announcement of the 25 pence placement.

The halt will last until a further announcement is made to the market, or until trade opens on Thursday.

The cash call will be done in two tranches and is to be used predominantly to fund the rail sidings required to transport coal from its Minas Moatize mine in the Tete region of Mozambique to the port of Beira.

It will also channel some funds into the two-part upgrade of the mine’s wash plant, using the remainder to satisfy the company’s working capital requirements.

The company said in an ASX release that it also remained in negotiations with potential lenders.

Beacon Hill chairman Justin Farr-Jones said the funding would allow the mine to begin production.

"The placing, which has received strong institutional demand to date, will strengthen the company's balance sheet and will enable us to complete important rail infrastructure upgrades, commence the Phase 2B and 2C wash plant upgrades and leave sufficient working capital for our rail operations,” he said in the release.

“In addition, and most significantly, the funding will be sufficient to see the Minas Moatize operation enter full-scale production of coking coal."

It is expected that admission of the first tranche placing shares to AIM and ASX will occur at 8am March 18 and 10am March 19, respectively.

The company also announced that a general meeting was scheduled between the two tranches, on April 3.

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