Alliance Mineral shareholder Burwill cuts planned investment, deal underwriter has to mop up

SINGAPORE - Alliance Mineral Assets' substantial shareholder Burwill Commodity cut a planned investment into the Lithium miner, taking only 13 million new shares of a proposed 23.9-million-share placement at $0.33 per share.

The company carried out a placement exercise to sell the remaining 10.9 million shares at $0.34 apiece, but placement agent and underwriter Canaccord Genuity had to mop up 7.6 million unsubscribed shares after placing 3.3 million shares with an unnamed Australian institutional investor. The $0.34 per share placement price represents a discount of about 8.7 per cent to Alliance Mineral's volume-weighted average price of $0.3725 on July 4.

No reason was given for Burwill's trimmed investment.

Net proceeds from the underwritten placement shares amount to about $3.48 million, with 43 per cent of the proceeds to be allocated as capital expenditure for the Bald Hill Lithium and Tantalum Project in Western Australia, Alliance Mineral said.

In addition, 43 per cent will be used as working capital for the Bald Hill Project, and the remaining 14 per cent will be used for future exploration and other initiatives at Bald Hill Project.

Following the allotment and issuance of the 13 million Burwill placement shares and 3.5 million in compensation shares, the total number of issued and paid-up ordinary shares of Alliance Mineral has increased from about 632.09 to 648.59 million shares.

The underwritten placement shares represent about 1.65 per cent of Alliance Mineral's enlarged issued share capital.

The company also issued 3.5 million new compensation shares to five individuals, after it was approved at an extraordinary general meeting held on June 25. Those individuals were Ong Kian Guan, with 250,000 shares; Mahtani Bhagwandas, with 250,000 shares; Leaw Mun Ni, with 1.125 million shares; Shaun Menezes, with 1.125 million shares; and Tony Dominkovich, with 750,000 shares.