It’s a penny stock buyer’s market. Adelong Gold jumps +20% as Nova Mins buys in

Adelong Gold (ASX:ADG), both a nanocap and a pennystock, has jumped +20% in mid-arvo trades to 0.6cps after Nova Minerals (ASX:NVA), also listed on the Nasdaq, bought a 9.4% stake in the former. Nova has a market cap just shy of A$140 million.

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While the latter reassured shareholders on Tuesday, its main focus remains its Estelle Project, of which it reminded that current on-site drilling is due to wrap up shortly; the 9.4% stake in ADG does, according to Nova, offer it the potential to tap “undervalued, high-growth” projects.

Seeing as one could, with some impoliteness, perceive that Adelong has capital raised itself into a hole, the opportunity might be well-received on both ends.

And just possibly a better deal for Nova, which remains to be seen, but seeing as Nova receives a first right of refusal for antimony that may or may not be found on-site, Adelong’s digs, that could be the case.

“Nova’s strategy [is] to partner with undervalued, high-growth-stage resource companies with projects… that offer near-term production upside,” NVA wrote.

The company also highlighted that it continues to apply for U.S. DoD grants.

For its part, Adelong receives $1M in cash from the deal, which it’ll use to “meet initial funding commitments to the Adelong Gold Project in NSW,” which it holds in a JV with Great Divide Mining (ASX:GDM).

At the same time, from that $1M, the company also expects to be able to advance drilling on-site to other projects, too. A further $250K is coming from Barclay Wells, which is investing on “equivalent pro-rata terms.”

And maybe what could eventually prove to be most telling: Nova gets to put a board member on Adelong’s.

ADG last traded at 0.6cps today.

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