Strickland Metals Ltd (ASX:STK) is raising $7 million through a placement and share purchase plan (SPP) to support exploration at its flagship Millrose Gold Project on the northeast flank of the Yandal Belt.
New and existing institutional and sophisticated investors have supported the placement, with STK set to release 80 million fully-paid ordinary shares at $0.05 per share.
The offer price represents a 15% discount to the 15-day volume-weighted average price (VWAP) of STK shares, as well as and a 12% discount to the last closing price of 5.7 cents.
STK directors have shown their support by subscribing for $165,000 in shares under the placement, although this is subject to shareholder approval.
Where’s the money going?
The cash injection will support work at STK’s wholly-owned Millrose Project and continue exploration across the Iroquois zinc-lead discovery in the Earaheedy Basin.
At Millrose, the company will use the money to:
- Complete infill drilling in the ‘gap’ between the southern and northern resource domains, a position prospective for both supergene and primary gold;
- explore along strike extensions to the north and south as identified in the geophysical and geochemical datasets;
- prospect depth extensions, with a focus on the high-grade domains to understand underground mining potential;
- further define extensive, near-surface laterite mineralisation; and
- investigate parallel trends to the west of the main defined shear zone.
The money will also be used to cover the placement costs and for general working capital.
STK continues to deliver results
"This year’s drilling campaigns at our flagship Millrose gold project have continued to deliver results exceeding our expectations. They have also contributed enormously to our understanding of the geology and controls on mineralisation, which underscores our decision to add an additional drill rig,” Strickland CEO Andrew Bray said.
“The placement and SPP we have announced today allows us to maintain our momentum at Millrose with a focus on initially drilling the full extent of the 13-kilometre gold structure, before returning to newly identified areas to undertake resource drilling and ensuing study work.
“The raising will also allow us to temporarily move the third rig to our Earaheedy project (located around 70 kilometres north of Millrose) to undertake a series of programs targeting further zinc-lead mineralisation at Iroquois and the recently announced prospect, Malecite.
“We are pleased that the evolving Strickland story has resonated so strongly with so many existing investors, and also welcome new shareholders to the register through the Placement. We are also pleased to offer all shareholders the opportunity of funding the company's exploration growth through the share purchase plan."
SPP details
After the placement wraps, STK will undertake an SPP to raise another $3 million, bringing the capital raise to $7 million.
Eligible shareholders can apply for up to A$30,000 in new STK shares without incurring brokerage or other transaction costs.
New shares will be issued at the same price as the placement shares. The SPP offer period will open on Thursday, August 18, and is expected to close at 5:00 pm AEST on Friday, September 9.
The indicative timetable for the SPP is outlined below:
