Convertible note deal terminated, $3.8M raised via placement

This morning our silver exploration investment Thomson Resources (ASX: TMZ) announced that it had cancelled the previously announced convertible note financing arrangement and instead raised $3.8M via a placement @ 4.1c per share.

Just a few weeks ago we wrote about the convertible note agreement TMZ had managed to raise $3M through.

In that Quick Take we detailed how we thought the convertible note agreement could put more pressure on the company’s share price in the short to medium term.

In today’s announcement, TMZ has completely cancelled that deal and has instead raised $3.8M via a direct placement.

This placement takes away the risk of conversions from the note creating selling pressure.

To summarise, we think the cancellation of the convertible note agreement is a good move and with the $3.8M placement @ 4.1c due to be settled on the 22nd of April, we suspect the share price will move closer to the placement price in the short term.

What’s next for TMZ: We want to see TMZ complete all of the resource updates as part of its Hub and Spoke strategy at its Silver projects.