Hot Chili (ASX:HCH) is set to raise $14 million through an entitlement offer. The company is also engaging with strategic partners to further the development of its Costa Fuego and Huasco Water projects, following the release of a Prefeasibility Study. Hot Chili is a copper-gold exploration and development company focused on its flagship Costa Fuego project in Chile. The company aims to become a major copper producer.
The offer, scheduled for August 13, will issue shares at $0.60 on a two for 13 basis. This price represents a 3.4 per cent premium to the last trading price of $0.58 on August 4, and a 4 per cent discount to the 15-day volume weighted average price. Eligible shareholders will have the opportunity to apply for additional shares through a shortfall facility if they fulfil their entitlement.
BMO Capital Markets is acting as the financial advisor for the partnering process, with Hot Chili currently evaluating proposals from several investors. According to Managing Director Christian Easterday, the company is pleased to offer this opportunity to eligible shareholders. Easterday added that funding from the rights issue will facilitate a significant upgrade to the company’s copper and gold resource base, particularly advantageous given the current strong market conditions for both commodities.
Hot Chili intends to enhance the financial, technical, and operational capabilities of its Costa Fuego and Huasco Water projects by securing one or more strategic partners. The company is also expediting phase two of diamond drilling at its La Verde discovery, which is part of the Costa Fuego Project in Chile’s Atacama region. Previous drilling defined copper mineralisation spanning a substantial area, and the company plans to streamline a maiden resource estimate for the project with the new drilling phase.
