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Alkane Resources does deal to build stake to 15% in Genesis Minerals

Through an executed share subscription agreement and underwriting agreement, Alkane plans to invest $6 million to build its stake to around 15% in Genesis.

two puzzle pieces being pushed together to represent merger concept
The shares Alkane is buying will be at a price of 3.2 cents each

Alkane Resources Ltd (ASX:ALK) has committed to invest $6 million to build its equity interest in Genesis Minerals Ltd (ASX:GMD).

Genesis owns the Ulysses Gold Project which has a 760,000 ounce JORC-compliant gold resource grading 3.3 g/t located 30 kilometres south of Leonora in Western Australia.

The $6 million will be spread across an initial placement, a right issue, and an option secondary placement, which will be subject to shareholder approval.

READ: Alkane Resources drills 110 metres at 1.97 g/t gold at Peak Hill

The deal comes as the AUD gold price hits a record high this morning of A$2,130 per ounce.

Alkane continues to be a profitable gold producer through its Tomingley Gold Operations (TGO) in New South Wales where recent exploration has discovered nearby gold to possibly increase the mine life.

Most recently, a 10-hole diamond drilling program at the Peak Hill Gold Mine (PHGM) within the greater Tomingley Project returned results featuring 110 metres at 1.97 g/t gold from 197 metres.

The PHGM is on care and maintenance and located 15 kilometres sound of the TGO, which was operated by Alkane from 1996 to 2005 as an open cut, heap leach operation

Proactive caught up with Alkane in July for an update.

Quick facts: Alkane Resources Ltd

Price: 0.825 AUD

ASX:ALK
Market: ASX
Market Cap: $417.53 m
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