Shares in Africa focused junior gold producer New Dawn Mining (TSX:ND) were marked higher at the open this morning on the Toronto Stock Exchange after the company confirmed it had raised just over CAD$7.5 million through a non-brokered private placement.
While New Dawn didn’t disclose who they placed the stock with, they did confirm that all of the stock with placed with funds managed by a UK based investment firm. New Dawn also managed to raise funds at $1.80 per share – a premium to the closing price yesterday of $1.72 – and issued no warrants with the placement and paid no brokerage commissions; suggesting very strong interest from its newest shareholder.
Post placing, New Dawn retains a tightly held profile with just 48.24 million shares outstanding on a fully diluted basis.
The capital injection will be directed at advancing gold production at the company’s three gold camps in Zimbabwe and for general working capital purposes. New Dawn operates 3 significant gold camps in Zimbabwe, where it owns 6 mines, 3 of which are currently producing gold and expanding production annually.
“In particular, the proceeds will be used in part to fund the working capital requirements of Central African Gold (AIM:CAG), as well as to expand gold production at CAG's gold mining operations in Zimbabwe.”
New Dawn acquired an 89% controlling interest in Central African Gold in June.
More recently, New Dawn reported a 92% increase in total measured and indicated mineral resources to 1.56 million ounces of gold grading 2.37g/t. Inferred mineral resources rose by 54% to 552,600 ounces of gold, grading 4.95g/t.
In addition, results also saw a 32% increase to the company's total mineral reserves to 220,000 ounces of gold grading 3.81g/t from 1.78 tons of mineralized material. The mineral reserves are comprised of proven reserves of 109,400 ounces of gold grading 3.69 g/t, and probable reserves of 110,600 ounces of gold grading 3.78 g/t.
New Dawn is targeting total annualized gold production of 50,000 to 60,000 ounces within the next 18 to 24 months, rising to 100,000 ounces of annualized gold production within the next 4 to 5 years.
Shares in New Dawn rose nearly 5% to trade at CAD$1.80 per share this morning.