QX Resources Limited (ASX:QXR) has fully underwritten a rights issue lodged by Bayrock Resources Limited to raise $1.8 million before costs at $0.03 a share.
Bayrock is an Australian unlisted public company with a portfolio of highly prospective battery minerals assets in Sweden, primarily in nickel. cobalt and copper.
QX previously provided secured loans of $585,000 to Bayrock to help complete the acquisition of the Lainejaur and Northern Nickel Line projects in northern Sweden.
The projects are considered highly prospective for key battery metals, nickel, copper and cobalt, presenting as high grade quality “Class 1” nickel-copper-cobalt sulphide projects.
The funds from the Rights Issue will be applied to exploration, including drilling, assays and technical consultants; payments to the vendors of the Bayrock projects; repayment of debt, including to QX; expenses of the offer; and general working capital.
QX Resources Chairman Maurice Feilich said the company’s financial support for Bayrock had allowed it to make critical milestone payments to acquire its assets in Sweden and advance exploration activities.
Feilich said: “We are pleased with their progress so far, and the conversion of our loans into Bayrock shares reflects our strong confidence in the Company’s future prospects.
“We are committed to unlocking value for all Bayrock shareholders and continuing to support their exploration and project development efforts in Sweden.”
In order to recapitalise Bayrock’s balance sheet, repay debt (including to QX and project vendors) and fund ongoing activities at Lainejaur and the Northern Nickel Line (including high-impact drilling), QX converted $255,000 of existing debt (principle, interest and fees) into Bayrock fully paid ordinary shares, representing about 16 per cent of Bayrock.