Minerals 260 (ASX:MI6) has secured $250 million through a two-tranche placement to fund development of its 6.2-million-ounce (Moz) Bullabulling Gold Project in Western Australia.
The placement comprises approximately 284.1 million new shares at $0.88 each, representing no discount to the closing price on 11 September and a 3.5% premium to the 10-day volume weighted average price of $0.85. As previously reported, Franco-Nevada (TSX:FNV) provided a cornerstone commitment of $30 million.
The company also plans to offer eligible shareholders a share purchase plan (SPP) to raise up to $30 million at the same issue price, with directors intending to participate.
Combined with existing cash of $183 million and an additional $170 million royalty funding from Franco-Nevada, Minerals 260 will have approximately $633 million available for development activities at the project, located 65km west of Kalgoorlie.
Managing Director Luke McFadyen says the capital raising significantly strengthens and de-risks the company’s balance sheet to continue development on an accelerated timeline.
Argonaut Securities, Euroz Hartleys, and Bell Potter Securities acted as joint lead managers and bookrunners, with Canaccord Genuity Australia and Morgans Corporate as co-lead managers.
The placement is divided between an unconditional tranche raising $178.9 million through roughly 203.3 million shares using existing capacity, and a conditional tranche raising $71.1 million through an estimated 80.8 million shares subject to shareholder approval at a general meeting expected in late October.
Settlement of the first tranche is expected on 22 September, with shares commencing trading on 23 September. The SPP booklet will be released on 28 September.
Minerals 260 expects remaining funding for the project’s estimated $855 million pre-production capital requirement will come through traditional project finance. In line with this, the company says it has received multiple non-binding indicative term sheets for facilities exceeding requirements.
The company targets completion of project financing to align with a final investment decision in Q1 2027.
Proceeds will advance the project through development and construction phases, including investment in long-lead items, early works, engineering design, water infrastructure, the owner’s team, exploration activities, and working capital.
The Bullabulling Gold Project hosts a mineral resource estimate of 190 million tonnes at 1.00 grams per tonne gold (Au) for 6.2Moz across five deposits on granted mining leases. The resource comprises 140Mt of indicated resources at 0.98g/t Au and 51Mt of inferred resources at 1.00g/t Au.
The project represents a potential open pit mining operation located 25km west of Coolgardie in the Eastern Goldfields region.
Minerals 260 is an explorer and developer focused on advancing its flagship Bullabulling Gold Project in WA.
Write to Paula Fabe at Mining.com.au
Images: Minerals 260
