Magnetic Resources (ASX:MAU) has received binding commitments to raise $4.8 million via a placement of 6.66 million new shares at $0.72 per share.
The placement price represents a 10% discount to the company’s last closing price of $0.80 per share.
Magnetic says it plans to use the funds raised to further the development of its Laverton gold projects. Specifically, the $189.56 million market capitalisation company will put the money towards an infill and extension drilling program to increase resources and JORC categorisations and towards early work studies.
The funds will also go towards completing an initial Feasibility Study and preparations to begin mining, as well as general working capital.
Commenting on the capital raise, Magnetic Resources Managing Director George Sakalidis says: “Exploration drilling continues to intersect significant widths and grades at Lady Julie North 4, which is providing the company with increased confidence to increase not only the size but also the category of JORC resource.
“The funds raised will allow us to increase the resource size and ultimately move closer towards our goal of mining“
The funds raised will allow us to increase the resource size and ultimately move closer towards our goal of mining.”
Following the completion of the placement, Magnetic will be ‘well-funded’, with over $6 million cash at hand to advance studies on its gold assets and move towards production.
Settlement of new shares is expected to occur on 27 September 2023, and allotment on 28 September 2023.
The placement was led by Magnetic Resources, with 5% brokerage fees payable.
Magnetic’s Laverton gold assets include Lady Julie Central, Lady Julie North, Hawks Nest, and Homeward Bound.
Magnetic Resources is a new emerging gold producer in Western Australia. The company is focused on its gold projects in the ‘established’ mining region of Laverton.
Write to Aaliyah Rogan at Mining.com.au
Images: Magnetic Resources
