Genex Power (GNX) will soon have enough capital to begin construction on its flagship Kidston Pumped Storage Hydro Project in North Queensland.
The energy stock will raise $90.3 million for the project via a capital raise, which is made up of both a placement and a 11-for-20 pro-rata entitlement offer.
Under the institutional placement, GNX has received commitments to raise $34 million via the issue of 170.1 million shares, while under the entitlement offer an additional 280.3 million shares will be issued to raise $56.3 million.
All of the new shares will be issued at 20 cents each — which represents a 27 per cent discount to the 5-day volume-weighted average price on March 23.
At this stage the placement is due to close on March 26, while the entitlement offer will open to eligible shareholders on March 30.
Along with the capital raising, Genex has been awarded $47 million in funding via a conditional grant from the Australian Renewable Energy Agency (ARENA).
The grant will be used in conjunction with the $610 million debt facility provided by the Northern Australia Infrastructure Facility to help fund the construction of the Kidston project.
Additionally, ARENA has also agreed to convert $9 million in development funding previously promised to Kidston into a non-recoupable grant.
The funding conversion essentially means that the existing convertible notes on issue to ARENA will be cancelled.
All up, the multiple new lines of funding will allow Genex to begin working on the construction project in North Queensland.
Genex CEO James Harding explained the company now the $777 million it needs to get started.
“Today’s announcement, securing the balance of funding required to take the Kidston Pumped Storage Hydro Project to financial close, is a significant achievement for the company,” he said.
“More importantly, to be in a position to finance the Project on a 100 per cent equity basis and retain full ownership and control of the asset is a favourable outcome for Genex and its shareholders,” he added.
Shares in Genex Power remain in a trading halt related to the funding announcements. GNX shares last traded for 27.5 cents on March 23.