On January 22, Perth-based Australian company Northern Iron Limited announced that it has completed its AU$14.3 million ($12.9 million) institutional placement of 9.86 million new fully paid ordinary shares at a price of AU$1.45 ($1.31) per share.
A company press release said that the institutional offer was well supported with very strong demand from both new and existing institutional investors. The institutional offer was part of a AU$55.3 million equity raising that included OM Holdings Limited agreeing to subscribe for 28.25 million new shares at AU$1.45 ($1.31) per share to raise AU$41.0 million ($37.02 million), equating to a 10 percent shareholding interest.
Proceeds from the institutional offer and OMH Placement will be used to fund capital rectification works required to address plant performance at the Sydvaranger iron ore project in northern Norway and provide Northern Iron with additional working capital flexibility.
"The investment by OMH combined with its additional technical expertise and input, and the ongoing support from existing shareholders is a strong endorsement of Northern Iron's outlook as its completes the transition to iron ore producer," Northern Iron chairman Neil Hamilton stated.
Northern Iron intends to redevelop the Sydvaranger Iron Project to commence production of magnetite iron concentrate for supply into the European market. The Sydvaranger iron project encompasses three magnetite deposits with JORC compliant resources (Bjornevatn, Fisketind Ost, Kjellmannsasen).