- De Grey Mining (DEG) will raise $100 million through a placement to fund exploration and drilling at its Hemi discovery
- Approximately 83.4 million shares will be issued at $1.20 per share
- Fellow ASX-lister and major shareholder, DGO Gold (DGO) has committed to invest $12 million, which will secure a 15.8 per cent holding
- Including the $12 million, DGO has invested a total of $43 million in De Grey since May 2018
- Additionally, Non-Executive Director, Peter Hood, will invest $360,000
- According to Managing Director Glenn Jardine, De Grey has never been better placed to turn the Hemi discovery into a tier-one gold project
- Company shares have dropped 5.57 per cent and are trading for $1.36
De Grey Mining (DEG) has received firm commitments to raise $100 million through a placement.
De Grey will issue approximately 83.4 million shares at $1.20 per share. This price represents a 16.4 per cent discount to the last traded share price of $1.44 on September 8 and a one per cent premium to the 10-day volume-weighted average price (VWAP).
As part of the placement, fellow ASX-lister and major shareholder, DGO Gold (DGO) has committed to invest $12 million, which will secure a 15.8 per cent holding. DGO has participated in every one of De Grey’s capital raises since its initial investment. The fresh capital injection brings the total sum of DGO’s investments in De Grey to $43 million since May 2018. Non-Executive Director Peter Hood will also invest $360,000.
Both DGO and Peter’s investments are subject to shareholder approval which will be sought at an extraordinary general meeting which will be held late next month.
Also as part of the placement, Non-Executive Chairman Simon Lill, Executive Director Andrew Beckwith and the Chief Financial Officer and Company Secretary, Craig Nelmes, have completed a partial selldown of their shareholdings, totalling 2.6 million shares, at the same price as the placement.
The partial selldown is being conducted for “personal financial reasons” including to fund the exercise of 2.5 million De Grey options.
De Grey will use the money from the placement to support exploration and drilling activities at its Hemi discovery.
“The Hemi discovery in the Mallina Basin is rapidly moving towards our goal of defining a tier-one project with true district-scale potential. This significant capital raising puts De Grey in a position of financial strength to turn this potential into greater value for all of our shareholders,” Managing Director Glenn Jardine said.
The miner currently has two diamond rigs, two reverse circulation rigs and one aircore rig operating at Hemi and a second aircore rig operating in the Greater Hemi area. The funds will allow this definition drilling to continue well into next year.
De Grey is also encouraged by the recent discoveries of the Falcon zone and new lode within the Crow zone (both of which lie next to Hemi) as they show there’s significant potential to grow and upgrade the mineralisation footprint.
“De Grey has never been better placed to achieve our goal of realising a tier-one gold project at Hemi,” Glenn added.
The placement shares are slated for issue on September 18.
Company shares have dropped 5.57 per cent and are trading for $1.36 at 10:29 am AEST.