The shares of metals miner Copper 360 jumped as much as 33% on Monday after it announced it had successfully raised a further R99.7m as part of a plan to fund its expansion strategy and secure short-term working capital requirements.
In 2023, the Northern Cape-based company raised R274m through debt and equity to fund the R200m Nama Copper acquisition — which would allow it to double its copper concentrate production capacity and output for 2025 — as well as fund the expanded production plan for the Rietberg Mine, entering into new equity, debt and royalty agreements to fund the transaction.
In a statement on Monday, Copper 360 told shareholders it had raised an amount of R99.7m in new equity by February 14, through an issue of shares for cash on the terms and conditions.
“We are excited to have secured the additional funding that allows us to complete the acquisition of Nama Copper and to secure in large part our short-term working capital requirements,” CFO Stephan du Plessis said.
He said the cash relief came “as we build up our exports of copper concentrate and copper cathodes, which, in turn allows us to finalise our offtake arrangements”.
Copper 360 shares were up 33.21% to R3.53 in midday trade, on track for their best day since listing in April 2023 and valuing the company at R1.7bn on the JSE.
Used as a conductor of heat and electricity, as a building material and as a constituent of various metal alloys, such as sterling silver used in jewellery, copper is widely expected to benefit from the green-energy transition in the coming years.
The emerging miner is the only pure copper player on the local bourse and has built a hydrometallurgical plant that extracts the metal from oxide resources in Nababeep and surroundings near Springbok in the Northern Cape.
Its growth strategy is centred on establishing profitable copper cathode and concentrate operations. In late November it announced the acquisition of Nama Copper Resources, which is touted to provide Copper 360 with an immediately available sulphide processing plant capable of milling 240,000 tonnes of ore per year.
Copper 360 says that Nama Copper, bought from Mazule Resources and situated next to its operations in Nababeep, will ensure that it doubles its production in its 2025 financial year.
“The post-period acquisition of Nama Copper further ensures we remain on track to deliver significantly improved production with a major reduction in execution build and delivery risk,” CEO Jan Nelson told investors at the group interim results in November.
“The 2025 financial year will see the company target EBITDA above R650m together with major resource upgrades to improve mining flexibility and growth.”
With the new tranch of cash, Copper 360 said the final payment of R50m the for Nama Copper acquisition is now funded, clearing the way to finalise offtake agreements on all copper production.
However, SA’s sole listed copper producer said shareholder dilution would be limited through the use of mixed-funding.
Du Plessis assured investors on Monday that “the latest tranche of R100m will limit the potential dilution to shareholders through its hybrid nature”.
In funding its growth and expansion targets, which include the redesign of the Rietberg mine that is meant to significantly boost ore production rates over the life of the mine and the first modular flotation plant aimed at delivering greater concentrate volumes there, the group has opted for an amalgamated structure, including debt and equity and scrip lending with Cape Copper Oxide.
The financial director said the total capital raised through various structures of debt and equity now stood at R374m.
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