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Ferrum Crescent to pull the trigger on GoldQuest acquisition

Published: 15:34 27 Apr 2016 BST

Gold key
The option to acquire Goldquest runs out at the end of July.

Ferrum Crescent Limited (LON:FCR, ASX:FCR) has conditionally raised £650,000 through a placing of shares and a share subscription at 0.13p a share.

The placing and the subscription were both oversubscribed, the metals project developer said.

The company needs the funds so it can exercise its option to acquire GoldQuest, which owns two lead-zinc exploration projects in the provinces of Leόn and Galicia - two historic Spanish mining areas. The potential acquisition was first announced back in February.

The option to acquire Goldquest runs out at the end of July.

Any money left over after the Goldquest acquisition will be used for general working capital purposes, including a potential structured work programme across GoldQuest's assets, with the objective of establishing a maiden JORC code-compliant resource estimate for the assets, the rapid establishment of metallurgical characteristics and a viable metals separation and processing profile. 

"We are delighted with the continued strong investor support for the Group's activities and its ongoing strategic renewal as a cost-effective, asset-backed exploration company leading to a strong over-subscription for this fundraising. Ferrum Crescent is now well placed to drive the capital value of our established Moonlight project in South Africa, particularly as the firming iron ore market this year should awaken interest in our circa 300m tonne (JORC resource) Moonlight project, independently valued in June 2014 at a preferred value of US$33mln,” said Justin Tooth, executive chairman of Ferrum.

"We are also now in a good position to proceed in due course to exercise the GoldQuest Option and then proceed to advance the low cost, high potential Toral project in Spain towards a credible mineral reserve for future consideration by potential acquirers and/or development finance groups.  We look forward to providing updates on our progress both in Spain and in South Africa in due course," he added.

As usually happens after a share issue, Ferrum's share price headed down towards the placing price, in this case falling 0.023p to 0.142p.


 

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