- Gold Mountain has missed out on a potential $22.5 million in funding today after private investors pulled out of their subscriptions
- In March, a group of investors agreed to buy 100 million Gold Mountain shares with 200 million attaching options
- The money raised would be used to fund activity at Gold Mountain’s Wabag Project in Papua New Guinea.
- Today, however, the investors said some unforeseen approval delays mean they have to pull the plug on the investment
- Gold Mountain shares have remained flat, worth 5.4 cents each at market close
Gold Mountain is down $22.5 million in potential funding after a group of private investors pulled the plug on a share placement today.
In March 2019, Gold Mountain announced it had received commitments from professional and sophisticated investors to buy up 100 million company shares for 10 cents each — effectively raising $10 million.
Furthermore, for every two shares issued, the investors would also receive two options: one exercisable at 10 cents within a year, and another exercisable at 15 cents within two years. This would raise an additional $12.5 million for Gold Mountain.
The funds were planned to support capital requirements for the next two years of exploration at the company’s Wabag Project in Papua New Guinea.
Until today, when it all fell through.
Gold Mountain told the market the investors had terminated their commitments to the placement due to “unforeseen delays in the process of obtaining regulatory approvals for the transaction”.
Essentially, the investors said they were unable to complete the placement in within a reasonable time, and subsequently had to pull out.
In a small silver lining, however, Gold Mountain said the investors continued to indicate a strong interest in the company and said they would be happy to re-engage in the future should transaction pathways become feasible.
In the meantime, Gold Mountain is looking for other funding options and says it will update the market in due course.
Gold Mountain shares remained flat today, worth 5.4 cents each in a $32.48 million market cap.