Ausgold (ASX:AUC) is raising $35 million to streamline its Katanning Gold Project towards a final investment decision with acquisition of freeholding land that is already under option.
SCP Resource Finance and Euroz Hartleys acted as joint lead managers and bookrunners for this placement, with Canaccord Genuity as the co-manager.
The company will issue 61.4 million shares at an issue price of $0.57 per share, representing a 7.3% discount to its last trading price of $0.615 listed on 7 July.
Ausgold expects to settle the placement on 17 July.
In addition, the company will allocate 61.66 million shares until capacity under its listing rules, at this same issue price.
Dundee Corporation has subscribed at $2 million to stake 10.08% interest of Ausgold upon completion, and Ausgold directors’ subscriptions to amass $150,000 through 263,159 shares.
Executive Chairman John Dorward says the completion of its Definitive Feasibility Study for the Katanning Gold Project marks a milestone for the company’s prospective future as an Australian gold producer.
“This new capital stands us in good stead to progress works in relation to our next goal of rapidly accelerating the development of the KGP to a final investment decision and continuing to explore our extensive tenement holding,” Dorward says.
“I am delighted with the support of many of our existing shareholders and welcome a few new high-calibre institutional investors to the Ausgold register.”
Funds will also be delegated to an upcoming drilling program while also sustaining the company’s flexibility with acquisition payments over long lead items that will bolster the Katanning Gold Project.
Ausgold is focused on development of its Katanning Gold Project in Western Australia to become Australia’s next gold producer.
Write to Maddison Elliott at Mining.com.au
Images: Ausgold
