URU Metals shares tanked on Friday after the group raised £300,000 through a heavily discounted placing at 3p per share.
The discount represents an eye-watering 65% discount to yesterday’s closing price of 8.5p and is one of the largest discounts a company has had to offer shares to secure funds this year.
The placing was conducted by Axis Capital Markets Limited, which has also been appointed as the company’s joint broker with immediate effect.
The company said funds will accelerate development at URU’s Zebediela project. However, it’s difficult to see how far £300,000 will go before the company will require further funds.
“As things begin to pick up at the Zebediela project we are pleased to announce a partnership with Axis as these funds are pivotal in accelerating our ongoing work program. We look forward to updating the market on several fronts in the near term,” said CEO John Zorbas.
According to Uru, they will focus on geophysical interpretation to target higher-grade areas of the Zebediela project and they plan to reinterpret historic drilling results to establish groundwork for a maiden NI43-101 compliant resource. Achieving a maiden resource will require far more than £300,000.
The company has issued convertible loan notes and has recently extended the maturity date. Uru produced zero revenue in the most recent half-year period.