Blackheath Resources (BHR.V) has announced it’s planning to conduct a private placement with its units priced at C$0.40. Each unit will include one common share as well as half a warrant valid for 2.5 years and exercisable at C$0.53. As Blackheath’s share price closed at C$0.26 before the announcement, the placement will be conducted at a hefty 54% premium.
This shows that the placees have a lot of confidence in the company, as not only are we impressed by the company’s ability to raise cash at a substantial premium, the unit also has just half a warrant attached to it valid for 2.5 years which is quite positive as a lot of other exploration companies out there need to seduce investors by offering a full warrant valid for a much longer time.
Nobody likes dilution, but it really says a lot about the company’s assets and its ability to raise money when other exploration companies are struggling. Meanwhile, drilling at the Covas and Borralha projects is ongoing and we are expecting to see results quite shortly.
Disclosure: The author holds a long position in Blackheath Resources. Blackheath is a sponsor of the website. Please see our disclaimer for current positions.