The Hastings Technology Metals Ltd (ASX: HAS) share price is sinking in early trading on Wednesday.
Hastings shares are deep in the red, swapping hands 17.9% lower at $4.45 apiece at the time of writing, following a company announcement.
What did Hastings Technology announce?
The ASX rare earths producer advised it had received two commitments to raise $110 million via a two-tranche share placement.
The placement will seek to raise that amount by issuing approximately 25 million new ordinary shares for $4.40 apiece. It will also hope to raise $10 million via a share purchase plan (SPP).
To date, tranche 1 of the placement has successfully raised $67 million, leaving tranche 2 – still subject to shareholder approval, by the way – hoping to raise $43 million.
The company advised it would use the proceeds to advance the development of its Yangibana project in Western Australia. The project aims to produce rare earths neodymium and praseodymium.
Management commentary
Speaking on today's update, Hastings executive chair Charles Lew said that strong institutional demand for the placement was a "testament to the world-class nature" of the project, despite "soft market sentiments". He added:
The introduction of these high-quality institutions, together with the support shown by current long term shareholders, has ensured that Hastings is well-capitalised to maintain development momentum at Yangibana, which remains on track for commissioning in mid-2024.
As mentioned, tranche 2 of the placement is subject to shareholder approval. Hastings will seek this at a general meeting that's expected to be held on 10 October.
Hastings share price snapshot
The Hastings share price was a more robust $5.42 at the close of trade yesterday, and had lifted more than 20% in the past 12 months and up 28% in the past single month of trade.
Shares in the company are now down 2% in the year, and up just 4% in the month following this morning's trading activity.
