Magnetite Mines Limited (MGT) has announced a 1-for-3 renounceable rights issue to raise up to $2.65 million. Magnetite Mines is an ASX-listed iron ore company focused on developing magnetite iron ore resources in South Australia. The company aims to use the raised capital to secure funding for its Definitive Feasibility Study (DFS) and to explore opportunities for gold and critical minerals within its South Australian tenement portfolio. The issue is priced at $0.065 per share, representing a 25% discount to the last closing price and a 30% discount to the 90-day VWAP.
For every new share subscribed, shareholders will receive one free attaching option, exercisable at $0.12 with a 2.5-year term. The options are intended to be tradeable on the ASX. Shareholders can also apply for additional new shares to cover any shortfall in the rights issue. The rights issue is renounceable, allowing shareholders to trade their rights on the ASX starting 12 August 2025. Mahe Capital is the Lead Manager and Underwriter and has partially underwritten the offer to $0.5 million.
The funds raised, net of costs, will support several key initiatives, including finalising a binding transaction with strategic partners such as JFE Shoji Australia Pty Ltd to secure DFS funding, supporting the completion of mining lease regulatory approvals, completing de-risking studies focused on water supply, and assessing the company’s South Australian tenements for gold and critical mineral potential in response to favourable market conditions. All directors of Magnetite Mines have indicated they will participate in the rights issue.
According to Magnetite Mines Chair Paul White, the board is committed to developing the Razorback Iron Ore Project and securing strategic partners to fund the DFS. White noted the increasing demand for premium-grade magnetite concentrates due to the steel industry’s transition to low-carbon steelmaking. The rights issue provides an opportunity for shareholders to participate at an attractive discount and support the company in unlocking the value of the Razorback Project. The rights issue opens on 15 August 2025 and closes on 29 August 2025.
