Savannah Goldfields Initiates $14 Million Capital Raising Program

Highlights:

• Savannah Goldfields (ASX: SVG) targets up to $14M in capital raising to restart gold mining and expand resources at Agate Creek and Georgetown.
• Key investor Wes Maas commits $7M, securing a 19.9% stake, while Morgans Corporate Limited leads the underwriting.
• Funds to support operations, exploration, and debt repayment, with the offer price set at a 25% discount to market value.

Capital Raising Strategy to Support Growth

Savannah Goldfields Limited (ASX:SVG) has announced a comprehensive capital raising initiative, targeting up to $14 million. This effort aims to strengthen the company's financial position and facilitate the restart of gold mining and processing at its Agate Creek and Georgetown projects. Additionally, funds will be allocated for resource expansion activities.

Breakdown of the Capital Raising Plan

The capital raise comprises several components, including placements, an entitlement offer, and convertible note issuance. The key aspects of the initiative include:

• Initial Placement: A fully underwritten placement to a cornerstone investor, involving 79 million shares at 1.5 cents per share, generating approximately $1.19 million.
• Entitlement Offer: A fully underwritten 1-for-1 non-renounceable entitlement offer to existing shareholders at the same price, expected to raise about $4.2 million.
• Conditional Placement: Subject to shareholder approval, the company plans to issue 300 million shares at 1.5 cents each to raise an additional $4.5 million.
• Convertible Note Placement: Savannah Goldfields will issue 15.3 million convertible notes at 28 cents per note to secure $4.3 million, pending shareholder and noteholder approvals.

Key Investors and Underwriters

Wes Maas, a prominent investor and business leader, has committed approximately $7 million to the initiative. Upon completion, Maas is expected to hold a 19.9% stake in the company. Morgans Corporate Limited is serving as the lead manager and underwriter for the placement and entitlement offer.

Utilization of Funds

The proceeds from this capital raise will be allocated toward:

• Restarting mining and processing operations
• Exploration and resource definition programs
• Meeting environmental financial assurances
• Settling existing liabilities and short-term borrowings
• General working capital requirements

Offer Timeline and Market Pricing

At the time of writing, Savannah Goldfields’ shares were priced at 2 cents, with the offer price set at a 25% discount. The institutional entitlement offer is scheduled to close on February 4, 2025, while the retail entitlement offer will conclude on February 19, 2025.

This capital raising initiative represents a strategic move by Savannah Goldfields to solidify its financial standing and drive long-term growth in the gold sector.

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