Cornish Metals said it is undertaking a fundraising of approximately £135 million before expenses, at an issue price of 60p per new ordinary share, to develop its South Crofty tin project in Cornwall.
The AIM-listed mineral exploration and development company structured the raise across a placing to institutional investors, direct subscriptions from existing backers and a retail offer through RetailBook, with net proceeds earmarked for the South Crofty build.
Glencore International has conditionally agreed to subscribe for 18.72 million new shares at the issue price, raising approximately £11.2 million, and Cornish Metals' wholly-owned subsidiary South Crofty has separately signed a six-year offtake agreement with Glencore covering 100% of tin concentrates produced, commencing with planned production start in 2028, on a minimum aggregate delivery volume of 27,513 mtu tin contained.
Glencore and Cornish Metals have also signed heads of terms for a potential revolving working capital facility of up to $10 million.
National Wealth Fund has agreed to subscribe for up to approximately 29.5% of the total amounts raised, and Vision Blue Resources has agreed to subscribe for approximately its pro rata entitlement, with both subscriptions to be set off against amounts the company owes them under existing credit facilities.
"The strength and calibre of our expanded shareholder register, together with the oversubscribed debt financing announced in May, demonstrate the strategic importance of the South Crofty project to both the UK and the wider Western critical minerals supply chain," said chief executive Don Turvey.
South Crofty is targeting first production in mid-2028, with dewatering having reached more than 400 metres below surface and refurbishment of the New Cook's Kitchen shaft under way as the project moves from construction toward operational readiness.
The company said the fundraising, together with the bond proceeds once released, positions it to take the project through to production, pending certain outstanding planning, environmental and other consents.
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The fundraising forms part of a wider £302 million sources-and-uses plan that also draws on the company's existing £12 million cash balance as at 1 October and proceeds from a $210 million Nordic bond issued in May, with £185 million earmarked for South Crofty capital expenditure, £55 million for capitalising the National Wealth Fund and Vision Blue facilities, and £32 million for interest payments on the Nordic bonds during construction.
Also, the raise and offtake agreement are conditional on shareholder approval, at a general meeting to be held on or around 9 November.
It added that the bookbuild for the placing is expected to close no later than 7 pm on 21 October, with admission targeted on or before 8 am on 10 November.