Geodynamics raises $3.8 million and announces share purchase plan
Steam flow at Habanero 3 March 2008 (source: Geodynamics)
Alexander Richter
21 Dec 2011
Geodynamics raises $3.8 million and announces share purchase plan with the funds to be used for advancement of the company's Habanero EGS geothermal power project, a JV with Origin Energy.
In a release this morning, Australian Geodynamics (ASX:GDY) announces “that it has completed a placement of 25.4 million shares at $0.15 per share raising $3.8 million to professional, sophisticated and institutional investors domestically and overseas. This represents a 20% discount to the volume weighted average share price (VWAP) for the last 5 trading days.
The placement is part of a capital raising program to raise $8 million through a combination of institutional placement and Share Purchase Plan (or “SPP”). With the result of the placement, the Company will now launch the SPP to raise a target amount of $4.2 million. If demand under the SPP offer results in this amount being exceeded, the Company will consider accepting applications under the SPP so that the combined amount raised does not exceed $10 million.
Geodynamics’ shareholders will be invited to participate in the SPP through subscription for up to $15,000 worth of new shares in the Company at the lower of the placement price ($0.15 per share) or a 7.5% discount to the 5 day VWAP at the Allotment Date, subject to a minimum offer price of $0.135. Details of the SPP will be announced shortly and documentation sent to shareholders.
The placement was conducted by RBS Morgans, Austock and New York-based Viriathus under S.708 of the Corporations Act and represents 7.1% of the existing issued capital. Following the issue, Geodynamics will have fully paid issued capital of 363.6 million shares. The funds raised from this placement and SPP will be used to progress the Company’s Cooper Basin Geothermal Project, commencing with drilling Habanero 4 in first quarter 2012.
Geodynamics’ Managing Director and Chief Executive Officer Geoff Ward said, “This is a measured capital raising that will ensure that we can move in a material way smoothly through our appraisal and development program, focused on demonstrating Australia’s first commercial geothermal project at the Habanero site. We have a clear strategy to achieve this over the next two years and are well prepared for our next drilling campaign at Habanero.
“The placement has been strongly supported by our cornerstone investors, Sentient and Sunsuper, and our project continues to be backed by Origin Energy through their direct investment and 30% interest in the Innamincka Deeps (EGS) Joint Venture. This support, together with our accelerated federal government grant funding and recently announced Habanero 3 insurance claim settlement, positions Geodynamics well to significantly advance our Deeps EGS project and target demonstration of a commercial scale project at the Habanero site within the next two years.
“Our Cooper Basin geothermal resource is a national scale asset capable of making a material contribution to Australia’s base-load energy needs for more than 40 years and we commend the Share Purchase Plan to our shareholders.”
Source: Company release (pdf)
