Metal Tiger completes further financing arrangement to pursue “high potential” opportunities
Metal Tiger PLC (LON:MTR) said it has completed a further equity derivative collar financing arrangement with its lender secured over 328,798 shares held by the company in Australian explorer Sandfire Resources (ASX:SFR).
Under the terms of the agreement, AIM-listed Metal Tiger has entered into a stock lending arrangement allowing the lender to borrow the Sandfire shares.
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The deal also allows the company to sell 63,045 and/or 265,753 Sandfire shares to the lender in three years at 80% of the reference price of A$4.40 and A$4.45.
Metal Tiger has also granted its lender the right to buy 63,045 and/or 265,753 Sandfire shares from the firm in three years at an agreed premium of 145% of the reference price.
As a result, the company has borrowed around A$1mln from the lender secured on the above terms with a maturity date of May 18, 2023.
Metal Tiger said the proceeds of the financing will be used to fund “a near term substantial investment opportunity” as well as other potential investments.
The group added that it can agree with the lender to utilise the balance of Sandfire Shares held by it to increase the size of the financing arrangement at a later date.
“Recognising the recent rise in Sandfire’s share price, the board has taken the proactive step of seeking to raise further funds…in order to have the flexibility to pursue high potential opportunities in current market conditions that the board believes have the potential to outperform over the period of the financing arrangement”, Metal Tiger chief executive Michael McNeilly said in a statement.
Shares in Metal Tiger were 1.2% lower at 1.7p in early deals on Wednesday.