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Australia's EMR Capital invests $12m in phosphate explorer

  • Andrew Woodman
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EMR Capital, an Australian resources-focused private equity firm, will invest A$12.75 million ($12 million) in Australian Securities Exchange-listed potash explorer Highfield Resources.

According to a filing, EMR will contribute A$12.75 million to a A$32 million round of funding being raised by Highfield through a placement. The firm will pay $A0.51 per new share, compared with $A0.48 per share that other investors will pay. Highfield traded at A$0.52 a share prior to entering a trading halt on Tuesday.

This is EMR's second investment in the firm having bought a $10 million stake in April last year. Highfield, which is studying a collection of potash projects in Spain, currently has three 100%-owned projects in the country.

The Javier-Vipasca, Pintano and Sierra del Perdón potash projects are located in the Ebro potash producing basin in Northern Spain covering a project area of about 350 square kilometers. The Sierra del Perdón project includes two former operating mines.

The new funds will be used to complete a definitive feasibility study over the Javier potash deposit, which an earlier study suggested could support a net present value of about $1.1 billion and generate an IRR of about 50%. The project has been slated for first production in 2017.

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