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Bass Metals updates market on second tranche of its fundraising initiatives

Bass Metals (ASX: BSM) is currently suspended as the company moves towards the tranche two objective to raise $20 million, which is in addition to the initial tranche of $4.3 million completed earlier in the month.

Bass said that the company is in discussions with a number of equity providers to raise new equity by way of a proposed entitlements issue to existing Bass shareholders.

Separately, RMB Resources Limited today signed a mandate to arrange an increase in the existing Corporate Loan Facility by up to $13 million, subject to RMB Resources credit approval and finalisation of due diligence.

Bass has outlined the potential funds from the second tranche are planned to be allocated to; manage a short-term working capital requirement largely associated with the Hellyer Mine Project; maintain an appropriate working capital position; and to provide adequate funding to sustain a large scale exploration program and gold tailings feasibility study.

Bass anticipates being able to provide a definitive update on the structure and timing of these fundraising initiatives on or before 31 August, 2011.

The board’s intention is to keep the company’s shares suspended, due to a view that reinstatement of trading may materially prejudice the ability to successfully complete the second tranche of financing.