Proactive Investor's  Instablog

Mining Projects Group (ASX: MPJ) is aiming to raise up to $1.05 million for the acquisition of Delcarmen Energy through a fully underwritten non-renounceable rights issue.

Funds raised through the issue will go towards payments to the vendors of Delcarmen that are due upon the grant of two exploration permits for coal (EPC).

It will also be used for ongoing activities at the two exploration permits relating to the acquisition, along with a third EPC relating to a separate acquisition.

The company is offering shareholders four new ordinary shares at $0.01 per share for every five shares held.

Each new share comes with a free attaching option exercisable at $0.015 per share, expiring on November 30, 2014.

Peregrine Corporate has agreed to underwrite the rights issue to $1.05 million for a fee of 6% of the value of the total shares underwritten.

In addition, two of Mining Project Group's directors, Bryan Frost and Richard Revelins, have agreed to sub-underwrite the shortfall up to a total of $300,000. Frost and Revelins are also directors and shareholders of Peregrine.

This rights issue takes the place of the proposed share placement to professional and sophisticated investors that was approved by shareholders at the company's General Meeting on May 18, 2012.

In February this year Mining Projects signed a binding heads of agreement to acquire 100% of Delcarmen, giving the company access to coal interests in Queensland.

This was followed by the announcement of a coal acquisition permit from New Coal Energy.

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