ROMARCO MIN INC NEW (OTCMKTS:RTRAF) Successfully Raised Capital For Its Haile Project

ROMARCO MIN INC NEW (OTCMKTS:RTRAF) has raised capital of $242 million to complete its Haile Project. The financing of $242 million coupled with its $200 million line of credit surpassed the required initial capex requirement of $380-$400 million. The company had previously informed the market that it plans to generate funds for its Haile Project through a secondary offering.

The benefits

The investors were cautious after the news of secondary offering, which was reflected in declining share prices in December. However, things turned out to be in favor of ROMARCO MIN INC NEW (OTCMKTS:RTRAF) due to a jump in the price of gold in January. Romarco’s management utilized the opportunity and issued 517 million shares at $0.467 per share for a total of $242 million. The equity financing is dilutive for shareholders, given the previous figure of 725 million shares. It will put pressure on the share price only for short-term.

Excellent time

Romarco decision to raise the capital through equity financing came at the right time, and Wall Street appears to be reacting well with RTRAF shares trading at $0.41 each, close to the issue price. With the financing, the company can plan production taking into account various predictable valuation metrics. The stock offers upside potential as the company focuses on conservative mine plans in the feasibility study. It can turn into a better investment in case mine-life gets extension, which holds a strong possibility considering the resource estimate and exploration data.

Haile Gold Project

Romarco is working on its Haile Gold Project based in South Carolina. It is expected to turn out into a promising low-cost gold mine for the company. ROMARCO MIN INC NEW (OTCMKTS:RTRAF) has made progress on two crucial fronts related to Haile Gold Project, and they are permitting and financing. It was previously facing permit problem as the Sierra Club claimed that the project violated environmental standards. Due to protests, Romarco agreed to increase financial guarantee for the reclamation cost by $5 million and succeeded in getting permit.

Related News

Leave a Reply

Your email address will not be published. Required fields are marked *

Copyrıght 2015 All RIGHTS RESERVED.