The Australian exploration company American West Metals (WKN A3DE4Y / ASX AW1) plans to ramp up activities this year, particularly on the potential copper DSO project Storm. To this end, they have now secured fresh capital.
As announced today by the company, which also recently presented an initial resource for the zinc, copper, and silver project West Desert, they are securing 2,655,418 AUD gross through the issuance of shares at 0.05 AUD per share to institutional and large investors. If shareholders approve at a general meeting to be held before June 30, 2023, the company will also issue a free, unlisted option to purchase one share with an exercise price of 0.10 AUD and an expiry date of November 30, 2026, for every two shares subscribed and issued under the placement offer to its participants.
In addition, American Metals is offering existing shareholders (from Australia and New Zealand) one share for every five shares held by shareholders registered on the record date (March 23, 2023) at an issue price of 0.05 AUD per share as part of a rights issue. This also includes a free, attached option for every two shares applied for and issued. The options offered under the rights offer have the same terms as the options to be issued under the placement offer, i.e., an exercise price of 0.10 AUD and an expiry date of November 30, 2026. This is expected to raise approximately another 2,665,418 AUD gross.
The rights offer is fully underwritten by RM Corporate Finance, which will receive a fee of 2% for its role as underwriter of the rights offer and a placement fee of 4% on the underwritten amount, as well as 20,000,000 options exercisable at a price of 0.10 AUD and expiring on November 30, 2026 (subject to shareholder approval at a general meeting of the company, as mentioned above).
In total, American West Metals should have around 5 million AUD available for the year 2023 after deducting the costs of the capital measures. This should enable the company to achieve quite a lot.
American West primarily wants to push forward massively with its flagship project Storm on Somerset Island in the Arctic archipelago of Nunavut, Canada, which grew significantly in 2022 through new high-grade copper discoveries! This season, up to 10,000 meters of reverse circulation drilling is planned, among other activities.
In the past season, a potentially large sedimentary copper system was discovered on the total license area of more than 3,000 km². The footprint of the near-surface, high-grade copper mineralization at Storm has so far been defined over an area of about 40 hectares with an average thickness of mineralization of 24 meters at 2.15% copper (weighted average grade from 32 drill holes), and four main zones of mineralization have been identified to date. The Storm project also has numerous unexplored targets within a 120 km long mineralized trend, including the Tempest copper project, where ten grab samples yielded >1% copper and up to 32% copper in gossans. Tempest is located 40 km south of Storm. The location of this project and its distance from Storm illustrate the extent of the prospective copper horizon in the project area.
American West will also conduct regional exploration work on both the West Desert project and the Copper Warrior project in Utah, so further news flow can be expected in this regard as well.
