Adriatic Metals (ASX:ADT) Announces Equity Raising for Vares Expansion
Operations Update
Adriatic Metals is ramping up its Vares Silver Operation, targeting 1,335koz AgEq production in 2024. Commercial production is expected in Q1 2025 with nameplate capacity of 0.8Mtpa in H2 2025. The company provides full-year 2025 production guidance of 625-675kt ore milled and 12,000-13,000koz AgEq produced. The Ausenco expansion study has been completed, requiring US$25 million to increase process plant capacity by 63% to 1.3Mtpa. Orders for long-lead items will commence in Q1 2025, and studies for mine production expansion are underway.
Corporate Update
Adriatic Metals completed a US$25 million concentrate prepayment arrangement with Trafigura in January 2025 and has received the funds. Additionally, the first quarterly debt repayment to Orion of US$19 million has been rescheduled from 31 December 2024 to 31 March 2025.
Equity Raising Overview
The company is conducting a two-tranche institutional placement of fully paid CHESS Depository Interests to raise A$80 million (US$50 million). The proceeds, along with existing cash of A$73.6 million (US$46.0 million), will fund the Vares Processing Plant expansion, mine production studies, and general working capital for the ramp up to commercial production. The offer price of A$3.90 is a 3.7% discount to the last traded price of A$4.05 on 17 February 2025 and a 7.3% discount to the 5-day volume weighted average price on the ASX of A$4.21.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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