BINDURA Nickel Corporation (BNC) board has extended the period to look for funds for its smelter by a month to February after investors requested for more time.
Mwana Africa investor relations executive Caroline Mathonsi said the process of raising funds is continuing until February 27 after it was initially supposed to close on January 23.
“The investors have requested for a bit of time as some of them started business this week. So the process of raising funds will take longer. The timetable has been changed at the request of prospective bond holders who require more time for their internal processes and procedures following the Christmas and New Year holidays,” Mathonsi said.
Mwana Africa holds 75,4% interest in BNC.
BNC said in a statement on Friday its shareholders should exercise caution when dealing in shares of the listed company.
“To this end the company is seeking funding for the project via the flotation of a fixed debt instrument. The directors of Bindura Nickel Corporation Limited wish to advise shareholders that the capital raising is still in progress,” the company said.
The company requires $26,5 million to restart the smelter and the funds would be provided through private placement of a redeemable fixed rate secure bond of $20 million and the balance will be funded from internal resources.
The coming on board of the smelter will improve the prospects of the business.
The smelter is expected to restart by the second half of this year.
The company is looking forward to bringing its refinery back into production as well as looking at the Hunter’s Road venture.
The company expects nickel prices to go up to $20 000 per tonne.
The mining counter was a major driver of the mining index last year after it doubled its share price from between 1,29 cents to 2 cents in June.
In its financial results for the six months ended September 30 2014, BNC saw its turnover rising to 3 891 tonnes of nickel at a value of $46, 4 million from 2 803 tonnes at a value of S$ 21, 4 million during the same period in 2013.
The average nickel price for the period was $18 515 per tonne up from $ 14 437 per tonne in the same period in 2013.
Cost of sales increased by 103% to $22, 6 million from $11,1 million on the back of increased tonnage and additional spending on company’s mobile fleet to improve availability and efficiencies.