VDM finds backers willing to pay 400pc premium; shares surge 50pc
A group of Angolans are so keen on copper explorer VDM Group, they were prepared to pay a 400 per cent premium to Tuesday’s share price to get in.
The company locked in $6m in cash via a private placement priced at 1c a share — on Tuesday the stock closed at 0.2c.
Director Michael Fry told Stockhead the deal was done with a group of investors in Angola who wanted to be involved in the company’s promising 65 per cent-owned Cachoeiras do Binga copper project.
“It’s potentially of very significant scale. Our work to date only covers around about 3km of a potential 330km strike of the coastal copper belt of Angola,” he said.
“So we’ve only just touched the surface in our work to date. Copper belts in Africa have the tendency to be prolific.”
VDM’s (ASX:VMG) shares rallied 50 per cent on the back of the news, hitting an intra-day peak of 0.3c. Nearly 2 million shares had changed hands by midday AEDT.
Earlier this week, VDM announced it had hit visible copper in 38 of the 41 holes drilled recently at the project.
Mr Fry said that is what led the Angolan investors to inject cash at a premium into VDM.
VDM plans to use the cash to continue exploration at the Cachoeiras do Binga project.
The company is undertaking an “aggressive” drilling program starting next year with the goal of delivering a resource within 12 months.
VDM is also on the hunt for other copper projects in West Africa.