News

• A$6M Offer comprising 30M shares at 20c closes early and heavily oversubscribed.
• Outstanding investor response with strong Australian and International institutional & retail demand.
• ASX listing scheduled for mid-December 2007.
• Aggressive manganese exploration to commence in 2008 at South Woodie Woodie Project.

Australian resource company Spitfire Resources Limited is set for a pre-Christmas debut on the Australian Securities Exchange (ASX Code: SPI) after today announcing that it had closed its A$6 million Initial Public Offer (IPO) a week early and heavily oversubscribed.

The Perth-based company said today (Sunday) that it had achieved its full subscription level (including the full level of oversubscriptions) well ahead of the scheduled 30 November closing date following an exceptional response from a broad range of Australian and International institutional and retail investors. Spitfire is now preparing for an ASX listing around 14 December 2007.

“We are delighted with the investor response, which reflects the potential of our South Woodie Woodie Project combined with a very high level of market interest in manganese assets worldwide,” commented Spitfire’s Managing Director, James Hamilton. “The significant manganese price increases seen this year reflects strong underlying demand and tightness in supply which is putting the spotlight on potential new supply sources.

“Spitfire has a simple and focused exploration and growth strategy, based on an initial aggressive exploration program to test eight priority manganese resource targets at South Woodie Woodie in March at the start of the 2008 field season,” Mr Hamilton added.

The Company lodged a Prospectus with the Australian Securities and Investments Commission (ASIC) on 22 October for the offer of up to 20 million shares at 20c each, to raise up to A$4 million with provision to accept oversubscriptions of up to a further 10 million shares at 20 cents to raise a further $2 million.

At completion of the IPO, Spitfire will have 61 million shares on issue with the project vendor, AIM-listed Churchill Mining, holding 25 million shares or 41% as vendor consideration.

The South Woodie Woodie Project comprises three granted Exploration Licences covering an area of approximately 490km2. The principal area of initial exploration focus lies about 50km down-strike from the 1Mtpa Woodie Woodie manganese mine.

Exploration success at South Woodie Woodie through the delineation of strategic manganese resources would position Spitfire to capitalise on strong levels of investor and market interest in the manganese sector, which has experienced a dramatic turnaround in the past six months following a significant tightening in the international market. 

Underlying demand for manganese remains strong, with the market forecast to continue to grow at an average of 7% per annum, underpinned by strong Chinese demand. Manganese prices generally track iron ore prices with the mineral being a non-substitutable input in the steel-making process, where it is used to strengthen and harden steel.

While manganese is abundant worldwide, high-grade (+48% Mn), low-phosphorus manganese ore of the style which is typically found in the East Pilbara region is not, and is regarded as a strategic mineral globally.