The Silex Systems Ltd (ASX: SLX) share price is plummeting today after the company provided an update on its equity raise.
At the time of writing, the nuclear energy and semiconductor company's shares are trading at $1.35, down 10%.
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What did Silex announce?
Investors are heading for the hills after the Silex share price came out of a trading halt today.
In this morning's release, Silex advised it has successfully completed an institutional placement. The offer received significant interest from domestic, international and uranium specialist institutions, raising $33 million.
Silex will issue around 26 million ordinary shares under the placement, which represents about 15.5% of its entire issued capital. The company set the price for each share at $1.27 apiece. This reflects an 11.8% discount on the last closing price of $1.44 traded on 22 September.
In addition, the company has launched a share purchase plan (SPP) to retail investors to raise another $7 million. It will offer an issue price at $1.31, slightly above the institutional placement price to meet the requirements of the listing rules.
What are the funds for?
The company will use the funds received from the equity raise for several initiatives, which include:
- Advance the SILEX uranium enrichment pilot demonstration project at Global Laser Enrichment's (GLE) Test Loop Facility in the United States;
- Assessment and potential development of opportunities for advanced nuclear fuel production with GLE;
- Scale-up of Zero-Spin Silicon production capacity for quantum computing;
- Develop additional applications of SILEX technology; and
- General working capital requirements and strengthen the company's balance sheet.
Management commentary
Silex CEO and managing director Michael Goldsworthy said:
This equity raising secures Silex's funding through to 2024 to further advance our SILEX enrichment technology commercialisation activities and to focus on the Paducah uranium production opportunity being planned by US-based exclusive licensee GLE.
With the outlook for nuclear power continuing to improve around the world and the demand for uranium, enriched silicon and other isotopes increasing, Silex is well-placed to respond quickly and efficiently to opportunities as they arise.
Silex share price review
It's been a mixed year for Silex shares, which has moved in circles for much of the 12-month period. However, the company's shares reached a 52-week high of $1.97 recently before treading lower, possibly due to profit-taking.
The Silex share price is roughly 139% higher since this time last year and is up 51.6% year-to-date.
