First Graphite enters 2017 with strengthened balance sheet following capital raising
First Graphite (ASX:FGR) resumed trading today after entering a trading halt on Tuesday, when it announced that it intended to conduct a capital raising.
The company raised $3.52 million at 11 cents per share, representing a discount of circa 20% to the last closing price of 13.8 cents prior to the company entering a trading halt.
Lead manager, Far East Capital, said the raising was well supported by institutional and high net worth individuals.
First Graphite will be using the funds to continue the development of its graphene technology strategies, including the recently announced BEST Battery project, and production from its own mines located in Sri Lanka which are currently being developed.
Commenting on the significance of the capital raising in terms of First Graphite’s outlook, Managing Director Craig McGuckin said, “It is pleasing that we can commence 2017 with a strong cash balance, underpinning what promises to be a significant year of progress on multiple fronts, from graphite and graphene production to the advancement of application for graphene”.
It would appear that investors have not been deterred by the issue of further shares and the discounted price of the capital raising with the company trading as high as 13.5 cents on Friday morning.
As indicated, this is broadly in line with its pre-capital raising price, suggesting the strengthening of the company’s balance sheet is viewed as a positive development.