Astral Resources NL (ASX:AAR) is set to build on the exploration momentum established at its strategically located gold assets in Western Australia after raising $3 million in a strongly supported placement.
Firm commitments have been received from sophisticated and professional investors in the single-tranche share placement which will see the company issue approximately 46.2 million shares at A$0.065 per share.
This placement, which is being undertaken within the company’s placement capacity under Listing Rule 7.1, was well supported by existing shareholders and new investors.
SPP for up to $2 million
In order to give eligible shareholders an opportunity to participate in the capital raising, the company is also offering a non-underwritten share purchase plan (SPP) to raise up to $2 million.
This will be open to all eligible shareholders in Australia and New Zealand and will be at the same issue price as the placement.
“Strong support”
Astral Resources’ managing director Marc Ducler said: “We are delighted with the strong support received from new and existing investors, particularly in the current challenging market environment.
"Following the recently announced upgrade of the mineral resource estimate at Mandilla to 37 million tonnes at 1.1 g/t gold for 1.27 million ounces of contained gold, the strong support received from investors continues to validate the company’s quality asset base and strategy."
Use of funds
Together with the company’s cash reserves, the proceeds of the placement will variously be used to advance resource definition drilling and technical and feasibility studies at the 100%-owned Mandilla and Feysville gold projects near Kalgoorlie.
Planned activities include:
- A ~3,000 metre reverse circulation (RC) exploration drilling program at the Feysville Gold Project, following up on previous high-grade assay results at the relatively undrilled Kamperman, Hyperno and Ethereal prospects.
- A ~4,000 metre RC drilling program at the Mandilla Gold Project, continuing the infill program within the southeast area of the cornerstone Theia deposit.
- Completion of the structural review currently taking place at Theia.
- Following completion of the structural review, a diamond drilling program will be undertaken, testing current high-priority targets as well as any potentially faulted mineralised offsets and high-grade trends identified through the structural review.
- Advancement of the Mandilla scoping study, which remains on track to be released later this year.
“Exciting period”
“The second half of 2023 will be an exciting period for Astral, with RC drilling commencing in early August at Feysville, followed by RC and diamond drill programs at Mandilla,” Ducler added.
“The Mandilla scoping study is also on track for completion later this year, which will mark a key milestone for the project.”
Capital raise details
The placement was made to eligible sophisticated, institutional and professional investors at $0.065 per share.
This represents a 15.7% discount to the 5-day volume weighted average price (VWAP) of $0.077 and a 9.5% discount to the 30-day VWAP of $0.072 as at Wednesday, July 26, 2023.
New shares issued under the placement and SPP will rank equally with existing fully-paid shares on issue.
Melbourne-based Cumulus Wealth Pty Ltd was appointed as lead manager to the placement and SPP.
Further information regarding the SPP, including terms and conditions, will be provided to eligible shareholders in the SPP Offer Booklet, to be issued following completion of the placement.
Astral encourages eligible shareholders who wish to participate in the SPP to act promptly in submitting their application forms.
The company reserves the right to close the SPP early, in its sole and absolute discretion, should it be considered appropriate to do so, by making an announcement to the ASX.