Energy and Minerals Australia Limited (EMA) has entered into a binding term sheet with Forrest Family Investments, an Andrew Forrest entity within the Minderoo Group, to raise $12 million by way of an equity capital raising.
In addition, the company’s note holders, leading Australian resource investment groups Acorn Capital Ltd and its clients, Macquarie Bank and the Element Resources Fund, have agreed that the debt owed to them shall be repaid in shares, subject to certain conditions. As a result $24.5 million of debt will be eliminated and converted into shares.
The two transactions will restructure EMA’s balance sheet and increase its net assets by $36.5 million.
Andrew Forrest noted: “My investment is a strong vote of confidence in the executive management team of Mike Young and Julian Tapp with whom I have had a long and successful working relationship.”
EMA’s managing director Mike Young said: “Julian and I have always worked extremely well with Andrew Forrest. We are confident this investment in the new management team will unlock EMA’s potential and future growth.”
The transactions will “provide EMA with a strong balance sheet and a more normalized capital structure. EMA is now set up to move the Mulga Rock Uranium Project forward to meet uranium demand which is expected to grow at phenomenal rate in coming years,” he said.
EMA remains focused on completing the feasibility study on Mulga Rock and achieving its target of production by the end of 2016.
EMA is a Perth-based resource development company. Its primary focus is development of the Mulga Rock Project, about 240km northeast of the regional city of Kalgoorlie-Boulder. The project shares access infrastructure with the large Tropicana Gold Project, owned by AngloGold Ashanti and the Independence Group.
Mulga Rock, which consists of four separate deposits named Ambassador, Emperor, Shogun and Princess, is one of Australia’s largest undeveloped uranium resources. The deposits also contain nickel, cobalt, rare earth elements (REE), yttrium, scandium, vanadium, copper, zinc and gold.