Flynn Gold Ltd (ASX:FG1) has launched a $6.1 million capital raising to fund further exploration and drilling at Trafalgar and elsewhere on the company’s Northeast Tasmanian gold assets, early exploration on WA lithium-gold assets and M&A opportunities.
The company has already received binding commitments from new and existing sophisticated and professional investors to raise $1.326 million via a placement, which will be followed by a partially underwritten non-renounceable entitlement offer of $4.8 million.
The placement and entitlement offer will be undertaken at an issue price of $0.10 per share.
Drilling and exploration at Trafalgar
Flynn Gold CEO Neil Marston said: “It is pleasing to note the strong support Flynn Gold has received as part of this offering.
“I thank investors who have participated in the placement and the lead managers for their support, and we are pleased to provide all existing shareholders with the same opportunity.
“The funds raised will enable the company to accelerate drilling and exploration activities at its Trafalgar discovery, where high-grade gold intersections have been recently announced, and to advance exploration on its WA lithium-gold assets.”
Flynn recently announced high-grade gold mineralisation from the ongoing drilling program at the Trafalgar discovery.
Trafalgar is located within the Golden Ridge Project in Tasmania where the company is exploring a gold mineralised corridor extending over an 8-kilometre-long granodiorite-metasediment contact zone.
Drilling has successfully intersected high-grade gold over an open strike length of 200 metres and to depths of up to 400 metres from surface (open), confirming a significant new gold discovery at Trafalgar.
The gold-bearing vein zones at Trafalgar remain open along strike and at depth, and funds raised will be applied to accelerate infill and extensional drilling.
Entitlement offer
Flynn Gold is undertaking the 1 for 2 non-renounceable entitlement offer to raise up to $4.8 million which is partially underwritten by lead manager Henslow Pty Ltd for up to $2.4 million.
The issue price of $0.10 cents per share represents a discount of 35.2% to the company’s 15-day VWAP of $0.154 cents as of 12 December 2022.
Colin Bourke and/or his associated entities, being the company’s largest shareholder group, have agreed to sub-underwrite $1.0 million of the underwritten amount under the entitlement offer by committing to take up part of their entitlements.
Under the entitlement offer, eligible shareholders will be given the opportunity to subscribe for one new share for every two existing shares held at the record date.
The entitlement offer will be offered to all shareholders with registered addresses in Australia and New Zealand who hold shares as at 7.00 pm (AEDT) on the record date being Thursday, 22 December 2022.