ERA’s A$880m fundraising faces delay
Uranium company Energy Resources of Australia (ERA) is facing a potential delay in its A$880-million entitlement offer, after the Takeovers Panel consented to a review of an earlier decision to allow the fundraising to proceed unchallenged.
ERA, which is majority owned by Rio Tinto, said on Friday that it would advise of a revised entitlement offer timetable after the outcome of the review application is known.
The company stressed that a review panel had not been appointed at this stage and that no decision had been made on whether to conduct proceedings.
Earlier in the week, the Takeovers Panel determined that the entitlement offer would not face proceedings, despite concerns by applications about the potential increase in Rio Tinto’s control over ERA. Rio Tinto, which currently holds about 86.3% of ERA, could see its stake grow to 99.25% if no other shareholders participate.
ERA on August 28 announced the capital raise to fund rehabilitation work at the Ranger project area, in Northern Territory, until the third quarter of 2027. At A$0.002 a share, the offer represented an 87.8% discount to the company’s stock on the last day before a trading halt was instituted ahead of the capital raise announcement.
ERA previously warned that it was likely to breach its minimum cash reserve of about A$50-million in the fourth quarter of the year and that it would deplete its cash resources by the end of the year or early in 2025. The equity raise was deemed necessary to ensure ERA remained solvent.
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