• Partially underwritten A$34.9 million equity capital raising
• Debt reduction of ~A$10.1 million and ~A$5.2 million working capital
• Minimum subscription results in A$22.3 million market cap, A$17.8 million debt, A$5.2 million cash

WA Kaolin Ltd (ASX: WAK) is pleased to announce a partially underwritten non-renounceable entitlement offer to raise up to A$34.9 million. The offer will be conducted on a five (5) for one (1) basis at A$0.010 per share, representing a 65% discount to the 10-day VWAP. Key investors including Century Horse, Boneyard, Wamco, and SMAO have agreed to participate and provide partial underwriting support. The minimum subscription of A$15.3 million will reduce debt by ~A$10.1 million and provide ~A$5.2 million in working capital, restructuring WAK's balance sheet and providing sufficient working capital to meet expansion in supply. The residual debt held by Scientific Management Associates and Wamco will total A$17.2 million. The company is also undertaking a program of asset improvements to improve plant efficiency and output, with an anticipated capital cost of less than A$500,000. Additional improvements are planned if the offer is subscribed above the minimum.

The debt reduction and additional working capital will position the Company well to deliver a range of high-quality kaolin products into a structurally altered global market for supply and demand. Management's immediate focus is on completing outstanding plant improvements which are anticipated to add revenue at substantially similar costs. The company is also developing a first-principles sales budget incorporating new sales lines, with detailed timelines to product delivery and revenue, and rational market-based sales growth assumptions.