Yandal Resources Ltd (ASX:YRL) has raised $6 million in a placement and issued 12 million shares with funds to accelerate an exploration program across its suite of gold projects in Western Australia.
DGO Gold Limited (ASX:DGO) subscribed for 8 million shares at 50 cents per share as part of the capital raising initiative and this extends that company’s brownfield gold discovery strategy.
The capital raising was also supported by another institutional investor, Regal Funds Management Pty Ltd (RFM), taking 4 million shares.
Endorsement of quality of assets
Yandal managing director Lorry Hughes said: “We are very pleased to have new strategic shareholders on the register.
“This is a great endorsement of the quality and potential of our asset portfolio.
“In particular, we welcome DGO which is backed by significant gold investors and led by Eduard Eshuys who has a proven track record of gold discovery in the Yandal and Norseman-Wiluna Greenstone Belts.”
“We look forward to their technical and strategic contribution to our drilling programs.”
The placement price of 50 cents per share represents a 7.1% premium to the five-day volume-weighted average prices (VWAP) of the company’s shares and a 7.4% discount to the last closing price before the trading halt.
This placement will be undertaken within the company’s existing capacity pursuant to ASX Listing Rule 7.1.
All shares issued under the placement will be ranked equally with the existing shares of the company.
To accelerate exploration
The company plans to use the capital raised in accelerating its exploration programs including resource development and extension drilling at the Flushing Meadows prospect.
Yandal will also spend proceeds on advancing drilling at the Gordons Dam prospect to test beneath and along strike of the high-grade palaeochannel and further exploration at the Ironstone Well, Barwidgee and Mt McClure projects.
Earlier this month the company intersected the highest gold grades to date at Gordons Dam prospect within the Gordons Gold Project in the highly prospective Kalgoorlie-Boulder Region of Western Australia.
A highlight of the 1-metre downhole sample fire assay results from reverse circulation (RC) drilling was 1-metre at 73.12 g/t gold within 8 metres at 11.03 g/t from 36 metres.
“Addition to portfolio”
DGO executive chairman Eduard Eshuys said: “We are pleased to make this addition to our portfolio of highly prospective WA gold discovery opportunities.
“We rate very highly the work done by the Yandal team and look forward to contributing our technical expertise and strategic thinking alongside our capital backing.”