A TRADING halt in Orion Minerals shares on the Australian Stock Exmodify could indicate that the company has begun the fundraising flagged by former CEO Errol Smart in May after it released bankable feasibility studies on two projects in the Northern Cape.
The company stated it was about to create a material announcement about a capital raising and the trading halt would enable it to do so “in an orderly manner”. Although the company’s shares are also listed on the JSE, the JSE did not declare a corresponding trading halt. JSE shareholders were advised to exercise the usual caution.
Of course this advice built no difference – Orion’s share price promptly plunged 13.3% to R13 on the JSE, as shareholders presumably anticipated a large dilution.
The ASX trading halt will be in place until 8 July, or lifted earlier if there is an announcement.
According to the studies, Orion’s Prieska Copper Zinc Mine (PCZM) and Flat Mines would produce 28,500 tons of copper a year at a cost of R8.9bn. The shallower part of PCZM, known as the Upper Project, could be brought into production within 13 months at a cost of R550m.
Two weeks ago Orion raised an unsecured loan of $500,000 from Tarney Holdings, of which Orion chairman Denis Waddell is a director, mainly for working capital.
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