Advanced gold explorer Alto Metals (ASX:AME) has secured firm commitments to raise $5 million for ongoing exploration at its Sandstone Gold Project in Western Australia.
Under the $5 million placement, Alto will issue about 96 million shares at $0.052 per share. The issue price represents a discount of 7.1% to the company’s last trading price of $0.056 and 11.3% to its 30-day volume-weighted average price (VWAP).
Further, the $34.31 million market capitalisation company says the placement was strongly supported by existing shareholders and new ‘leading’ resource-focused funds, including a $1 million investment from Lion Selection Group (ASX:LSX).
In addition to the placement, Alto has agreed to place about 8 million fully paid shares at the same issue price as the placement under a ‘drill for equity’ arrangement for $420,000.
Alto reports the placement will be completed in 2 tranches. Tranche 1 will comprise 101,384,615 shares to institutional, professional, and sophisticated investors and under the drilling agreement pursuant to Alto’s placement capacity.
Tranche 2 comprises about 2,856,154 shares for director participation in the placement, subject to shareholder approval to be sought at a General Meeting slated for September 2023.
The company says the issue of the new shares under Tranche 1 is expected to occur on or around 31 July 2023.
Commenting on the placement, Alto Metals Managing Director Matthew Bowles says: “Our drilling at Sandstone continues to deliver outstanding results, and this capital raising sees Alto fully funded for all our current exploration planned for CY2023 and forward program for the next 12 months.
“this capital raising sees Alto fully funded for all our current exploration planned for CY2023 and forward program for the next 12 months”
We are looking forward to receiving assays currently pending from over 4,500m of RC drilling at Indomitable, targeting potential high-grade structures in the primary rock at depth, and rigs are ready to be mobilised to follow up on these pending results. Regionally, our low-cost lithium exploration work is continuing along with our review of historical data.”
Alto Metals is a gold exploration company focused on its Sandstone Gold Project, located in the east Murchison region of Western Australia. The Sandstone Project covers about 740km-square.
Write to Aaliyah Rogan at Mining.com.au
Images: Alto Metals Ltd