Bauba forced to lower funding target

[] — BAUBA Platinum (the former Absolute Holdings) has run into a brick wall on its capital raising programme and been forced to lower its funding targets drastically.

Bauba was looking to raise up to R150m to pay for its exploration drilling programme on various platinum properties, and had stated it needed to raise a minimum of R60m.

According to a Stock Exchange News Service (Sens) announcement released on Monday, the minimum amount required has been dropped to R15m while the closing deadline for the capital raising programme has been extended to the end of June.

CEO Pine Pienaar told Miningmx: “We are doing this through a book build and, after what happened in the markets on Friday, we almost have to restart the book build. “

Pienaar said the decision to drop the minimum amount was a strategic one.

The aims were now to avoid excessive dilution of shareholders’ interests under current weak market conditions as well as to “get the deal done’, for which raising funds is a condition precedent.

The necessary resolutions were all passed at Monday’s general meeting of shareholders, including the decisions to reduce the minimum capital amount and extend the closing deadline.

Pienaar said the vendors of the assets to Bauba would continue to fund the exploration drilling work until the end of June. He added the drilling work so far had intersected platinum group metals mineralisation “at the anticipated depths’.

After that, the R15m would be enough to continue the drilling work which would prove up an inferred resource on a portion of Bauba’s southern cluster.

Bauba holds prospecting rights over eight farms on the Eastern Limb of the Bushveld Complex. They have been grouped geographically into three clusters, of which the southern cluster is viewed as the most prospective.

Pienaar said: “It costs about R2m per borehole. Hopefully, the market will be more stable by January next year and we will be able to raise more capital when backed by a SAMREC inferred resource statement.

“The fact that the market has fallen is less of a problem than the volatility in the market. The money managers simply don’t know where the market is going.’

Pienaar said Bauba would continue its information sharing roadshow with investors over the next two weeks, “after which it will inform shareholders of the proposed course of action going forward’.