Greatland Gold PLC (AIM:GGP, OTC:GRLGF) shares rose early on Monday as the company revealed it has secured up to A$340mln (£200mln) in new funding that it expects will fully fund its 30% share of developing the world-class Havieron gold-copper deposit in Western Australia into production, and unveiled three transformational board appointments.
Shares in the AIM-traded development and exploration company jumped over 11% to 9.25p following the announcements.
Greatland said three of Australia's top corporate and mining industry leaders will join its board to help with its growth strategy and transition into a gold and copper producer.
Mark Barnaba, an eminent natural resources investment banker and deputy chair of A$50bn ASX-listed Fortescue Metals Group Ltd will become Greatland’s non-executive chairman, and Elizabeth Gaines, former Fortescue chief executive and managing director, will become a non-executive director and deputy chair.
They both intend to take up a consulting role with effect from today before joining the board on or before 1 January 2023.
James 'Jimmy' Wilson, a former senior executive at BHP Group including the former president of its iron ore division, will join Greatland as an executive director from today.
Greatland said it plans to undertake a cross-listing on the Australian Securities Exchange to increase liquidity and provide additional access to capital.
Funding Greatland’s flagship asset
The company said it has signed a commitment letter, including a terms sheet, for a A$220mln, seven-year debt facility with Australia and New Zealand Banking Group, HSBC Bank, and ING Bank (Australia).
It also announced a proposed strategic equity investment of up to A$120mln from Wyloo Metals, a privately owned metals company, that would see the Perth-based group becoming Greatland’s biggest shareholder with a stake of about 8.6%.
"This is a tremendous announcement for Greatland to have a pathway to being fully funded for its share of the development costs of Havieron,” Greatland's managing director Shaun Day said in a statement.
"The significant size of each bank's commitment together with the strategic support from Wyloo highlights the long-term confidence in the Havieron gold-copper project and the strength of this world-class asset," he added.
Wyloo will subscribe for about 430mln shares at 8.2p per share, a 1.2% discount to Greatland’s closing share price on Friday, for a total initial investment of A$60mln. It will also receive warrants to subscribe for an additional 352.6mln shares at an exercise price of 10.0p per share.
Both the placement and the warrants are subject to the approval of Greatland's shareholders.
Wyloo CEO Luca Giacovazzi said the Havieron deposit was one of the most exciting recent mineral discoveries in Western Australia.
“The Paterson range is emerging as Western Australia’s next prolific mining province, and Greatland has an expansive tenement package, which we believe has great potential for further discovery,” Giacovazzi said in a separate statement.
“We are excited to be a part of the development of what we expect will be a low-cost, modern mining operation with very high environmental and social standards, and proud to be supporting another great Western Australian project," he added.
Completion of the debt facilities and Wyloo’s investment will enable Greatland to fully fund its share of the Havieron’s development to a 2mln tonnes per annum (Mtpa) operation, based on an October 2021 pre-feasibility study.
Greatland said it will also be well positioned to be fully funded for the targeted expansion to about 3Mtpa based on a feasibility study expected to be released in the December 2022 quarter.
Havieron was discovered by Greatland and is being developed through a joint venture with Newcrest Mining Ltd, one of the world's largest gold mining companies, which has a 70% interest in the venture.
World-class board for a world-class company
"The addition of such a high-quality team of successful professionals is a strong validation of the quality of Greatland's asset,” said Alex Borrelli, non-executive chairman of Greatland.
"In combination with our existing directors, we will have a world-class board to act as stewards of Greatland's interest in the Tier 1 discovery we have made at Havieron,” he added.
Borrelli will assume a senior non-executive director role as Lead UK Director following the new board appointments.
His successor, Barnaba, has been deputy chairman of Fortescue, the world's fourth-largest iron ore producer, since November 2017 and is also a board member of the Reserve Bank of Australia.
-- Updates with funding details, share price --