Predictive Discovery Ltd (ASX:PDI, OTC:PDIYF) will use the A$40.4 million raised in a strongly supported placement to drive growth and advancement of the 4.2-million-ounce Bankan Gold Project in the Siguiri Basin in Guinea.
The company welcomes the firm commitments received from institutional and sophisticated investors and will issue around 269.6 million shares at A$0.15 per new share.
There was strong demand from existing and new institutional investors with this being well in excess of the placement size.
“Delighted by demand”
PDI managing director Andrew Pardey said: “We are delighted by demand for the placement, including a keen interest from Tier-1 institutional investors, which is testament to the quality and potential of the Bankan Gold Project, which we believe can become West Africa’s next Tier-1 gold mine.
“We received strong support from our existing major shareholders, and we continue to enhance the breadth and quality of our share register, with new investors accounting for nearly 50% of the funds raised.
"PDI is building a deep shareholder base which can support the company through Bankan’s development phase.”
Modest discount to VWAP
The placement will be completed in a single tranche under the company’s current placement capacity as per ASX Listing Rule 7.1.
The issue price of A$0.15 represented a modest 6.3% discount to the last traded price and a 5.5% discount to the 5-day volume-weighted average price.
In further validation of the company and its gold strategy, members of the PDI board have collectively provided commitments to subscribe to an additional $150,000 in new shares, subject to shareholder approval at the next general meeting of the company which is expected to be in July 2023.
Use of funds
PDI intends to use placement funds to progress the Bankan Gold Project through a number of exploration and pre-development activities.
Ongoing resource definition drilling is aimed at further expanding and upgrading the existing 4.2-million-ounce mineral resource.
The company also intends to accelerate regional exploration drilling at multiple high-priority targets along Bankan’s 35-kilometre structural gold corridor, starting at the Argo prospects along strike to the north of the NEB deposit.
Argo drilling imminent
To the end, on-site preparation of drill pads at Argo is underway with reverse circulation (RC) drilling planned to commence in the first week of June 2023.
PDI will also use funds to complete the Environmental & Social Impact Assessment (ESIA) and scoping study.
“We continue on the pathway towards securing a mining permit in H1 2024, with funds from the placement allocated towards the key workstreams of ongoing resource definition drilling at NEB and BC, and completion of the ESIA and scoping study by late 2023,” Pardey said.
“Regional potential”
“We are excited to be allocating up to A$20 million of the placement towards accelerating our regional drilling in a results-driven manner.
“Bankan has excellent regional potential and recent exploration results and drill targeting at Argo highlight this.
“Pleasingly, RC drilling at Argo is on track to commence in the first week of June,” he added.
The new shares are expected to commence trading on the ASX on Tuesday, June 6, 2023, and will rank equally with PDI’s existing fully paid ordinary shares.
SCP Resource Finance LP and Euroz Hartleys Limited are joint lead managers and bookrunners to the placement while Argonaut Securities Pty Ltd and Canaccord Genuity (TSX:CF, LSE:CF) (Australia) Limited are co-managers.