Xanadu Mines (ASX:XAM) - CEO, Andrew Stewart
CEO, Andrew Stewart
Source: The Assay
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  • Xanadu Mines (XAM) is set to raise up to $12 million in a private placement to fund exploration work at its Kharmagtai project in Mongolia
  • The placement will be completed in two tranches, with the first to include approximately 123.8 million new shares for a total of $5.6 million
  • A second tranche will comprise roughly 142.9 million shares for a total of $6.4 million, subject to shareholder approval at a meeting scheduled for mid-September
  • The shares will be issued at a price of 4.5 cents, representing a 23.7 per cent discount to the company’s last closing price of 5.9 cents on August 5, 2020
  • Xanadu Mines shares are down 3.7 per cent at market close, trading for 5.2 cents per share

Xanadu Mines (XAM) is set to raise up to $12 million in a private placement to fund exploration work at its Kharmagtai project in Mongolia.

The placement will be completed in two tranches, with the issue of 266.7 million new shares at a price of 4.5 cents. This price represents a 23.7 per cent discount compared to Xanadu’s last closing price of 5.9 cents on August 5, 2020, and a 13.1 per cent discount compared to its 30-day volume-weighted average price of 5.2 cents per share.

Under the first tranche, which is expected to settle on August 17, Xanadu intends to raise approximately $5.6 million through the issuance of 123.8 million new shares.

The second tranche will be comprised of roughly 142.9 million shares for a total of $6.4 million, and remains subject to shareholder approval at a meeting scheduled for mid-September this year.

Argonaut Securities and CLSA Australia will act as joint lead managers of the placement, which Xanadu says has already received strong interest from a number of new domestic and international institutions.

Colin Moorhead, Non-Executive Chairman of Xanadu Mines, welcomed the substantial support, which includes an indicated participation from existing shareholders Asia Capital and SSI Asset Management.

“We are delighted with the strong support received from existing shareholders and several new sophisticated institutional investors,” Colin stated.

“This placement enables us to further strengthen our share register and our balance sheet which will enable Xanadu to execute its exploration strategy with vigour and unencumbered,” he explained.

The proceeds raised under the placement, in conjunction with Xanadu’s existing cash resources, will be used to fund exploration and resource definition drilling at its Kharmagtai project in Mongolia.

Located 420 kilometres southeast of Ulaanbaatar, the project sits within the South Gobi porphyry copper province, which hosts a number of established porphyry deposits. This includes the Oyu Tolgoi copper-gold operation 120 kilometres to the south, as well as the Tsagaan Suvarga porphyry copper-molybdenum development 170 kilometres to the east.

Xanadu Mines shares are down 3.7 per cent at market close, trading for 5.2 cents per share.

XAM by the numbers
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