Noble Helium Announces New At-The-Market Subscription Agreement
Noble Helium Limited (ASX: NHE) has announced an exciting development in its financial strategy through an At-The-Market Subscription Agreement (ATM) with Dolphin Corporate Investments (DCI). This agreement provides the company with access to up to $2 million of standby equity capital over the next two years, giving Noble Helium an additional funding option that enhances its financial flexibility.
Capital Facility with Minimal Dilution and Maximum Control
One of the key benefits of the ATM agreement is Noble Helium's ability to control the timing and size of any capital issuance, with minimal dilution for its shareholders. The company has full discretion over the issuance of shares, including setting a minimum issue price and the timing of any capital raising activities. This enables Noble Helium to manage its capital structure strategically and cost-effectively, avoiding the need for more traditional, often expensive, equity placements.
How the Agreement Works
Under this flexible agreement, Noble Helium has no obligation to utilize the facility but can do so at its own discretion. The agreement allows Noble Helium to set a price floor for any share issuance, ensuring that shares are not issued below a specified threshold. The final issue price will be determined based on the greater of the floor price or a discount of up to 4.4% on the Volume Weighted Average Price (VWAP) over a period determined by Noble Helium.
The company has placed 25 million fully paid ordinary shares as security for the ATM facility, which can be bought back and canceled at nil consideration upon termination or maturity of the agreement, subject to shareholder approval. This arrangement ensures that Noble Helium retains full control over its equity issuance and capital raising activities.
CEO's Statement on the ATM Facility
Shaun Scott, Managing Director & CEO of Noble Helium, expressed his confidence in the ATM agreement, stating, “The DCI ATM facility was recommended by significant shareholders and provides an additional fund-raising option and funding flexibility in addition to our traditional funding sources. The Company is in control of the issue timing and terms, so that in the event we decide to use the facility, we set the floor price and maximum number of shares to be issued, with the agreed discount of 4.4% being considerably less than the fees and discount required for a traditional placement.”
Outlook and Flexibility Moving Forward
The ATM facility with Dolphin Corporate Investments gives Noble Helium greater control over its capital raising strategy, ensuring that the company can access funds as needed without significant dilution to its existing shareholders. This, combined with the company's ability to set terms for each potential capital issuance, marks a significant step in strengthening Noble Helium's financial position as it continues to advance its projects and corporate objectives.
For further details on this announcement and Noble Helium's strategic moves, shareholders and investors can anticipate further updates from the company in due course.
