New Hope Corporation has increased its investment in Malabar Resources, an unlisted Hunter Valley based resources company.
New Hope first acquired a 15 per cent interest in Malabar for a total investment of $94.4 million in August 2022.
The major coal miner said at the time the investment diversified the company’s asset base by providing exposure to metallurgical coal mined by low impact, underground methods, among other reasons.
New Hope has now committed to taking up to $105 million of a minimum $160 million institutional placement equity raising launched by Malabar.
The company’s commitment to the Malabar equity raise will be funded from existing cash and includes about $76 million for a firm placement allocation that will increase New Hope’s shareholding in Malabar from 15 per cent to 19.9 per cent.
It also includes around $29 million for a conditional placement allocation subject to Malabar shareholder approval. If allocated, it will increase New Hope’s shareholding in Malabar to about 23 per cent. The new Malabar ordinary shares will be issued at $1.80 per share.
“The Malabar equity raise represents approximately 17.7 per cent of existing Malabar shares on issue,” New Hope said.
“Malabar will use the proceeds from the Malabar equity raise to accelerate Malabar’s development of the Maxwell mine project as a 300m long wall (versus an originally planned initial 145m long wall).”
The Maxwell mine is an underground metallurgical coal project located 10km south-west of Muswellbrook in the Hunter Valley of New South Wales. Malabar considers it to be its flagship project.
It is expected to generate more than $1–1.2 billion in mining royalties for NSW over the mine’s initial 26 years.
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