Viento Group has announced it will attempt to raise up to $7.23 million through a rights issue pitched at less than half its current share price.
The mining services contractor plans to use the funds raised to provide further working capital, strengthen the balance sheet and decrease debt.
The issue price will be 3 cents per new share.
For every two new shares subscribed for, one attaching new option will be issued.
These new options will be a new class of equity security, with each option convertible into an ordinary share at 3.5 cents per share at any time up to 31 March 2016.
Patersons Securities has been appointed to act as lead manager to the rights issue.
Viento says it is currently in discussions with Patersons Securities to potentially underwrite the rights issue for at least $6 million.
The directors of Viento plan to take up their entitlements under the rights issue and will also act as sub-underwriters.
The new shares issued will be fully paid ordinary shares, ranking equally with the company’s existing ordinary shares.
The timing of the rights issue has not been finalised.
The company’s shares have traded between 3.5 cents and 12 cents this year and closed unchanged today at 8 cents.
