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Afferro Mining to raise $24m through institutional placing

Afferro Mining (CVE:AUR) (AIM:AFF) reported Tuesday that it plans to raise £15.5 million (US$24 million) through a financing.

Afferro, which holds iron ore projects in Cameroon and Liberia, intends to sell 17.2 million common shares to institutional and other investors at 90 pence per share.

The placing price is equivalent to a 9.09% discount to the closing mid-market price on the London Stock Exchange, as of yesterday, it said.

The placing shares reflect an increase of 19.99% of the current issued share capital of the company.

Afferro  said it has applied for admission of the placing shares to trade on the AIM market of the London Stock Exchange, expected to begin trading on July 22. The company said it also plans to apply for listing on the TSX Venture Exchange. The placing is subject to regulatory approvals.

The company said it intends to use the profits to complete a drilling program, wrap-up a scoping study and start a preliminary assessment study for the Nkout project in Cameroon.

Additionally, Afferro plans to use the new funds to finance costs associated with the joint venture Putu project in Liberia, including a resource definition drilling program and an expedited prefeasibility study.

Further, the company will use profits from the placement for target identification in Cameroon, as well as corporate costs and general working capital.

Evolution Securities and RBC Capital Markets are acting as joint bookrunners, while GMP Securities Europe is acting as co-lead manager relating to the offering.

Afferro Mining is engaged in the acquisition, exploration and development of gold, iron ore and diamond properties. Through its subsidiaries, the company holds interests in mineral properties in Liberia, Sierra Leone, Guinea and the Democratic Republic of Congo.

The company said it is pursuing strategic discussions with a range of investors for additional financing for its Putu and Nkout projects.