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Power Metal Resources investee Katoro Gold completes oversubscribed fundraising

The company also noted that Katoro intends to execute an exploration drill program over existing targets at its Haneti polymetallic project in Tanzania

Power Metal Resources - Power Metal investee Katoro Gold completes oversubscribed fundraising

Power Metal Resources PLC’s (LON:POW) investee company, Katoro Gold PLC (LON:KAT) said it has raised £1.1mln in an oversubscribed fundraising to accelerate the development of its portfolio.

Katoro, which focus on gold and nickel exploration, said it has raised the funds through the placing and subscription of around 73.3mln new shares at a price of 1.5p each, a 31.8% discount to its closing price on Wednesday.

WATCH: Power Metal Resources to accelerate gold exploration work in Australia

The firm said the extra cash will allow it to pursue the development of its core projects, the Blyvoor gold project and the Haneti polymetallic project, “aggressively” at what it said was a “pivotal moment in their development/commercialisation”.

Power Metal, which owns a 3.99% stake in Katoro and a 25% interest in the Haneti project, also highlighted an announcement by Katoro that it had received “mid and tier 1 approaches with a view to earn-in, joint venture or similar, in respect of the Haneti project, with a primary focus on the nickel sulphide potential”.

Katoro said discussions were ongoing and that it also intended to finalise and execute an exploration drill program over existing drill ready targets at Haneti.

"We note the oversubscribed placing undertaken by Katoro as announced today.  It is positive to see Katoro progressing discussions following approaches from mid and tier 1 companies with regard to the Haneti project and also the finalisation and execution of an exploration drill programme”, said Power Metal chief executive Paul Johnson.

“The Haneti project is one of two POW project interests that are gearing up to undertake a drill programme, the other being the Molopo Farms Complex project in Botswana.  Both projects are targeting potentially high-impact nickel sulphide discoveries. I look forward to reporting further developments", he added.

Shares in Power Metal were steady at 0.55p in lunchtime trading on Thursday, while Kotoro Gold shares moved 21.6% lower at 1.73p.

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