Insights

Why the Rex Minerals (ASX:RXM) share price crashed 16% today

This small cap ASX share is seeking funding for two of its projects
The post Why the Rex Minerals (ASX:RXM) share price crashed 16% today appeared first on The Motley Fool Australia. –

The Rex Minerals Ltd (ASX: RXM) share price fell heavily today after emerging from a trading halt.

At the closing bell, the mineral exploration company’s shares were swapping hands for 30 cents, down by 16.67%.

What did Rex Minerals announce?

A catalyst for today’s fall could be concerns about an impending share dilution. According to its release, Rex Minerals has successfully raised $50 million (before costs) in a two-tranche placement.

The offer received strong support from existing institutional, sophisticated and professional investors. The company also added new institutional investors to its register.

Rex Minerals listed the issue price for 166.7 million new ordinary shares at 30 cents apiece. This reflected a 14% discount on the last closing price of 35 cents on 3 August.

The shares will be split across two separate tranches, with the first portion coming under the company’s listing rule 7.1. This allows them to issue approximately 17.8 million shares without shareholder approval.

The second portion of shares (roughly 148.8 million) will be subject to shareholder approval at a meeting in September.

All the company’s non-executive directors have participated in the placement, with those shares also conditional on shareholder approval.

The proceeds of the placement will be used to mostly fund pre-development activities at Rex Minerals’ wholly-owned Hillside copper project in South Australia. Furthermore, the company will set aside some of the money for its 100%-owned Hog Ranch gold property in Nevada, United States.

Rex Minerals managing director and CEO Richard Laufmann commented:

This is a significant milestone for the company and for the development of the Hillside copper project. A strong appetite from institutional investors reflects support for the development thematic to be a part of this nation-building project.

The funds raised place the company in a great position to begin pre-development at Hillside whilst progressing towards a Final Investment Decision for Stage 1 late next year, as well as pursuing additional value at Hog Ranch.

About the Rex Minerals share price

It’s been a wild ride for Rex Minerals shareholders, with the company’s shares accelerating by almost 80% year to date. Looking at a longer time frame, Rex Minerals shares are up around 38% since this time last year.

Based on today’s price, Rex Minerals has a market capitalisation of around $128.8 million, with approximately 422 million shares outstanding.

The post Why the Rex Minerals (ASX:RXM) share price crashed 16% today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Rex Minerals right now?

Before you consider Rex Minerals, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Rex Minerals wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

2 ASX 200 bank shares rated as buys

ASX 200 rises, Betmakers soars, REA Group drops

2 ASX 200 shares lifting to record highs before full-year results

What’s moving the CBA (ASX:CBA) share price this week
Here’s why the Atomo (ASX: AT1) share price flew 4% higher today

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!