Australian gold exploration and development company Gascoyne Resources Ltd (Gascoyne) has finalised a placement to raise approximately AUS$19 million (before costs) at an issue price of AUS$0.30/share.
The placement was reportedly oversubscribed with support shown from existing large institutional and professional investor shareholders and strong demand from new major domestic and international institutional investors, including successful resources investor, LIM Advisors (LIM), which was the basis of the placement, committing to subscribe for AUS$10 million.
In addition to the placement, the company will, subject to receipt of the necessary waivers, offer eligible existing shareholders with a registered address in Australia, New Zealand, Singapore and the UK the opportunity to participate in a Share Purchase Plan (SPP), to raise up to a further AUS$5 million at the same price as the placement. Proceeds from the equity raising are to strengthen the company’s balance sheet and provide additional financial flexibility to the company as the Dalgaranga Gold Project (Dalgaranga) in the Murchison region of Western Australia ramps up, with commercial production anticipated in late September / early October. Funds raised from the Placement will be applied towards the final payment required to be made to the vendor of Dalgaranga, remaining construction capital and critical spares, in addition to corporate costs and general working capital.
Subject to the ramp up at Dalgaranga progressing as anticipated, funds raised from the SPP are to be directed at both Dalgaranga and the Glenburgh gold project (Glenburgh) in the Gascoyne region of Western Australia. This is expected to include RC and diamond drilling of recent discoveries at Dalgaranga to allow conversion to Ore Reserves for inclusion in the mine plan as well as RC drilling on existing geochemical and structural targets at Glenburgh. Hartleys Ltd and Argonaut Securities Pty Ltd are Joint Lead Managers to the Placement.
Managing Director of Gascoyne, Mike Dunbar, commented: “We are grateful for the support received from both existing and new investors – as well as the strong support from LIM Advisors which cornerstoned the placement. We are also pleased to give our shareholders an opportunity to participate on the same terms as the placement through the upcoming SPP. The completion of the placement ensures that we have the financial flexibility we need as Dalgaranga ramps up towards commercial production. While initial mining rates have been slower than anticipated, our processing facility is running extremely well and mining rates are now within 10% of scheduled maximum rates. We are targeting commercial production and a 100 000 ounce per annum run rate late in the current quarter or early next quarter and look forward to keeping our shareholders up to date throughout our ramp up.”
Share purchase plan
Subject to receipt of the necessary waivers, the company is to also undertake a Share Purchase Plan (SPP) to its existing eligible shareholders, providing them the opportunity to subscribe for up to AUS$15 000 worth of shares at the placement issue price of $0.30/share to raise up to AUS$5 million. The SPP is proposed to open at 9.00 am on Tuesday 28 August 2018 and close at 5.00pm (AWST) on Wednesday 12 September 2018. Participation in the SPP will be open to all eligible holders of Gascoyne shares as at 15 August 2018 with a registered address in Australia, New Zealand, Singapore and the UK. Any shares not subscribed for under the SPP may be offered to qualified, institutional, sophisticated or professional investors at the discretion of the Board and subject to any necessary approval.
Read the article online at: https://www.globalminingreview.com/finance-business/20082018/oversubscribed-placement-sees-gascoyne-raise-aus19-million/
You might also like
Aya Gold & Silver has closed a US$100 million project financing facility for Zgounder silver mine expansion in Morocco.