The Capital Crunch: Ausgold to accelerate Katanning’s development

The final Capital Crunch for this week includes Ausgold’s (ASX:AUC) $38 million placement for the development of the Katanning Gold Project in Western Australia. 

Under the two-tranche institutional placement, 1.3 billion new shares will be issued at $0.03 per share, representing a 14.3% discount to the last closing price of $0.035 on 31 May. 

Proceeds will primarily be used to underpin ongoing work at Katanning through to a final investment decision, including completing a Definitive Feasibility Study, settle freehold land acquisitions, continue regional exploration, and general working capital. 

Ausgold says it has received binding commitments from large institutional investors from the UK, Europe, and North America, with Dundee Corporation subscribing for $3 million and Jupiter Asset Management subscribing for $7 million to increase its shareholding to 12.7%. 

SCP Resource Finance, Arlington Group, and Euroz Hartleys acted as joint lead managers to the placement. Gilbert + Tobin acted as legal advisors. 

Victorian gold explorer Navarre Minerals (ASX:NML) is moving to the second stage of its recapitalisation by way of a new equity issue, after completing a stage-one $1.7 million capital raising. 

Navarre conducted a convertible debt issuance to sophisticated and professional investors. Navarre directors Richard Taylor and James Gurry participated by investing $25,000 and $100,000, respectively. 

Part of the proceeds has been used to pay the deed administrator, totalling $525,000. As a result, the key conditions to remove the deed of company arrangement has been satisfied. 

Subject to various approvals, including from the ASX and shareholders, the company will conduct the second stage prior to resuming trading its shares. 

These proceeds will be used to fund exploration on its Victorian Projects and for general working capital. 

Meanwhile, copper and gold explorer Star Minerals (ASX:SMS) is conducting a placement and share purchase plan (SPP) to raise $564,000. 

Proceeds will be applied towards target generation and testing interpreted “high-grade” lode potential at the Tumblegum South Gold Project, as well as surface geochemical sampling and target generation work at the West Bryah Gold-Base Metal Project. 

The proceeds will also be used for project generation and general working capital. 

Under the placement, Star seeks to raise $264,000 via the issue of 8.8 million shares at $0.03 per share, representing an 8% discount to the 15-day volume weighted average price. 

The company notes 8.8 million options will also be offered to investors, with one free attaching option for every one share subscribed for. The options will be exercisable at $0.06, on or before 31 October 2026. 

Concurrently, Star seeks to raise $300,000 via a SPP under the same terms as the placement. Eligible shareholders can apply for up to $30,000 worth of SPP shares

Caravel Securities will act as lead manager to the placement and SPP. 

Lastly, Zenith Minerals (ASX:ZNC) and EV Metals have agreed to settle outstanding monies owed to Zenith, relating to a former farm-in agreement over its Western Australia lithium projects. 

The settlement is subject to Zenith receiving $400,000 plus GST in two tranches, comprising $250,000 on 7 June 2024 and $150,000 on 30 June 2024. 

Under the former farm-in, EV spent $9.3 million on Zenith’s Western Australian lithium projects. 

Zenith says the settlement will allow the company to refocus its exploration efforts following an 18-month hiatus in activity across the Western Australian lithium assets, namely Split Rocks and Waratah Well. 

Write to Aaliyah Rogan at Mining.com.au   

Images: Ausgold & Star Minerals
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Written By Aaliyah Rogan
Relocated from the East Coast in New Zealand to Queensland Australia, Aaliyah is a fervent journalist who has a passion for storytelling. When Aaliyah isn’t writing stories, she is either spending time with friends and family or down at the beach.