Genmin, an Australian Securities Exchange (ASX)-listed company, has initiated a fundraising effort to secure up to A$28.3m ($18.4m) for the development of its Baniaka iron ore project in Central Africa.

The project, wholly owned by Genmin, was granted a 20-year mining permit on 29 December 2023, alongside a Certificate of Environmental Conformance received in August 2023, providing the necessary regulatory approvals to proceed.

The company plans to commence the Baniaka project, with an initial production rate of five million tonnes per annum (mtpa), with ambitions to expand operations to more than 20mtpa in the future.

Genmin has set a target to begin commercial production at Baniaka by mid-2025 and is currently focused on securing project build financing as the next critical step.

To facilitate this development, Genmin is actively engaging with several potential financing partners.

The fundraising strategy includes a two-tranche placement with firm commitments for approximately A$13.2m and a one-for-three non-renounceable entitlement offer aimed at raising up to A$15.1m from eligible shareholders.

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The terms of the placement and entitlement offer are set at A$0.10 per share.

Additionally, investors will receive one free attaching, unlisted option for every three new shares subscribed, except for participants in tranche 1 of the placement, who will receive one free attaching new option for each new share subscribed.

Investors participating in tranche 1 of the placement, contributing around A$4.43m, will be entitled to one new option per new share and are expected to settle unconditionally by 13 February 2024.

Meanwhile, tranche 2 investors, with a total contribution of around A$8.79m, will receive one new option for every three new shares subscribed.

Earlier this year, Genmin secured a 20-year mining permit for the Baniaka project.