Platina Resources Limited (ASX:PGM) (FRA:P4R) has been up to 25% higher after becoming a substantial shareholder in Nelson Resources Ltd (ASX:NES) and increasing its exposure to gold in Western Australia.
The company became a substantial shareholder of Nelson on December 23 and now holds 5,748,535 shares for a 5.007% interest.
Between August 26 and December 23, 2020, Platina acquired 2,227,763 NES ordinary shares with a total value of $160,627.89.
Shares up 25%
Platina shares have been up as much as 25% to 5.6 cents intra-day after closing at 4.2 cents on December 23.
Nelson shares are more than 12% higher to 8.3 cents and are up from 5.8 cents at the market close on December 1.
Increasing its exposure to the Australian gold sector and Western Australia, in particular, comes after Platina completed the A$13.7 million sale of its Skaergaard gold and palladium project in Greenland in late November.
Canadian-listed Major Precious Metals Corp (CSE:SIZE) (OTCMKTS:SIZYF) (FRA:3EZ) acquired Platina’s stake with the ASX-listed junior receiving C$500,000 in cash (A$520,000) and 55 million Major shares.
Value of Major stake increasing
The value of this major shareholding is appreciating and at the last Major share price of C$0.40 represents C$22 million.
On completion of the sale, the value of Platina’s stake was C$12.65 million (A$13.2 million).
At the time, Platina managing director Corey Nolan said: “The deal allows us to ramp-up exploration activities at our Challa Gold Project which lies in-between the prolific Mt Magnet and Sandstone gold districts in Western Australia.”
“In addition to the cash funds, our Major shares can be sold over time to fund our activities, reducing the need to raise new equity and avoiding the dilution of our share capital.
“A large reconnaissance soil geochemistry program has just been completed at Challa to identify potential targets for deeper drilling.
“The company is also reviewing a number of merger and acquisition opportunities to build its gold presence.”
Nelson seeks next Tropicana
Nelson is stepping up exploration at the highly prospective Woodline Gold Project in WA’s Fraser Range as it seeks another Tropicana deposit.
A maiden diamond drill program is underway at the Grindall prospect with 1,000 to 1,500 metres to be completed by the end of next month.
This follows the company acquiring its own diamond drilling rig, associated vehicles and equipment that enable it to be more flexible and nimble with drilling.
Executive director and CEO Adam Schofield said: “The significant drilling cost savings to the company will allow for more drilling than previously planned at much lower costs than budgeted.”