Almonty's $800M Convertible and Russell Entry Can't Halt 25% Share Price Slump as Dilution Worries Mount
10.06.2026 - 18:45:48 | boerse-global.de
Almonty Industries has just pulled off a feat that would typically send a mining stock flying: it raised $800 million in an oversubscribed convertible note offering and secured a coveted slot in the Russell 1000 index. Yet shares have tumbled 25% over the past month, a stark reminder that even game-changing financing can be read as a dilution warning by the market.
The Toronto-listed tungsten producer closed the convertible note on June 9 after upsizing the original $700 million target by $100 million through full exercise of the greenshoe option. Net proceeds landed at $772.7 million after fees and discounts. The notes carry a 2.25% coupon, mature in July 2031, and were priced at a conversion premium of 32.5% — a conversion price of roughly $27.40 per share based on the June 4 close of $20.68 in U.S. dollars. Interest payments begin on January 1, 2027.
Almonty will deploy the capital along three paths: roughly $543 million for working capital and possible acquisitions, $50 million to refinance existing debt, and $83 million into capped-call transactions that limit dilution for current shareholders when bondholders eventually convert. The move cushions the equity hit, but it hasn't erased the market's unease.
Sangdong Ramp-Up Set for July as DFARS Deadline Looms
All eyes are on the Sangdong mine in South Korea, where Phase 1 of commissioning is complete and full production is due to start in July 2026. The fresh cash covers not only the Phase 1 ramp-up but also Phase 2, which will double processing capacity. Once at full output, Sangdong is expected to supply over 80% of the world's tungsten produced outside China.
Should investors sell immediately? Or is it worth buying Almonty?
That timing aligns with a regulatory catalyst: from January 1, 2027, the U.S. Defense Federal Acquisition Regulation Supplement (DFARS) will ban Chinese tungsten from defense supply chains. Almonty, with its Korean asset and operating Portuguese mine Panasqueira, stands as a prime beneficiary. First-quarter results already demonstrated the momentum — revenue jumped 221% to C$25.4 million, driven by higher APT spot prices and strong Panasqueira performance. The company held C$259.9 million in cash at the end of March.
Index Forced Buying Meets Technical Weakness
The Russell 1000 and Russell 3000 inclusion, effective June 29, is a mechanical tailwind: about $12.2 trillion of assets are benchmarked to the Russell indexes, and passive funds tracking them must buy Almonty. Many large institutional investors were previously unable to hold the stock.
Yet for now, the chart tells a different story. Shares trade at C$21.59, down roughly 3% on the day and 25% over the past 30 sessions. The decline pushed the relative strength index to 37, signaling oversold conditions. The stock sits about 20% below its 50-day moving average but well above the 200-day average of C$16.91. Year-to-date the gain is 79%, and over 12 months it has surged 346%. Analysts peg a target price near C$25.00, pointing to tight global tungsten supply and Almonty's role in Western defense and technology supply chains.
Almonty at a turning point? This analysis reveals what investors need to know now.
At the annual general meeting on June 9, shareholders re-elected the full seven-director slate originally nominated in the April 29 information circular. The board signaled it would continue refining its skill set and diversity as the company deepens its U.S. market presence.
For Almonty, the next few weeks bundle three catalysts into a tight window: the Sangdong production kickoff, Russell rebalancing, and the DFARS deadline. Whether the stock's recent slide was a dip or a warning sign will be decided by the mine's operational rhythm.
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