THE trading drought is finally drawing to a close for Gold Coast-based copper miner CuDeco (ASX:CDU) with news that the company's shares will resume trading on May 6.
The news comes on the heels of the corporate watchdog lifting a stop order on a non-renounceable rights issue that is aimed to raise $63.1 million to help fund completion of the company's Rocklands copper project near Cloncurry.
The stop order was put in place by the Australian Securities and Investments Commission in February due to concerns over disclosures in the prospectus for the rights issue.
CuDeco has revealed that the rights issue is now on track to be completed by May 3. It also has decided to open the issue solely to shareholders with registered addresses in Australia, New Zealand, Hong Kong, Singapore and China.
The one-for-four rights issue is priced at 80c a share, with three of the company's cornerstone Chinese investors indicating they will take up their full entitlement.
CuDeco's shares have remained in a trading halt since August last year, after the company's colourful founder Wayne McCrae resigned as executive chairman.
His departure was prompted by pressure from the company's major Chinese investors, namely China Oceanwide International Investment Co and Sinosteel Equipment & Engineering Co.
CuDeco shares last traded at $1.10 each, a significant premium to the rights issue's strike price.
CuDeco plans to use the proceeds of the rights issue to complete the construction and commissioning of Rocklands, to repay a short-term loan to major shareholders and for working capital.
It has engaged Australian-based Paradigm Securities as lead manager and underwriter for the revised right issue, which was originally launched in late 2015. Once completed, CuDeco will have 394.3 million in issued capital.
A feasibility study undertaken by Mining Associates earlier this year revealed the Rocklands project will generate about $2 billion in revenue over the next decade and create annual net free cashflow of $631 million for CuDeco.
The company is said to have about 2.2 million tonnes of ore stockpiled on site since it began excavations in 2012.
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