APC Minerals Limited (ASX: APC) is launching a pro-rata renounceable entitlement issue to raise up to $1.93 million before expenses. The offer entails issuing three shares for every two held at $0.011 per share, along with one free new option for every three shares subscribed. ShareX Pty Ltd is conditionally underwriting the offer. Funds raised will primarily fuel exploration at the Laverton Downs Gold (LDG) Project, allocating $1 million for drilling up to 192 holes. Additionally, $146,400 is earmarked for heritage surveys and airborne surveys at the West Arunta Region (WAR) Project. A significant portion, $500,000, is designated for converting existing loans, and approximately $53,318 will be used for working capital.
The offer includes a shortfall component, allowing eligible shareholders to apply for additional shares not taken up in the initial entitlement. The allocation of shortfall shares remains at the discretion of the underwriter and the APC Minerals board. The directors recommend that all shareholders take up their entitlements. The Company has appointed Leeuwin Wealth Pty Ltd and Cumulus Wealth Pty Ltd as joint lead managers of the Offer. Leeuwin Wealth Pty Ltd will also act as a priority sub-underwriter.
The pro-forma balance sheet following the full subscription reflects a significant shift from a net asset deficiency of $394,387 to a net asset position of $1,305,331. This is largely due to the conversion of debt and the infusion of capital. However, the company acknowledges risks, including potential dilution for non-participating shareholders and the speculative nature of mineral exploration. If shareholders do not participate in the offer, their holdings are likely to be diluted by approximately 60%.
