De Grey Mining is launching a bid to raise $600 million for its Hemi gold project in the Western Australian Pilbara.
The equity raising will be conducted at a fixed price of $1.10 per share, which comes in at a 13 per cent discount to the last closing price of $1.265 per share on May 7.
The proceeds, together with existing cash, are expected to fully fund the equity component of the Hemi project financing and will be used to fund costs like construction and exploration.
“The underwritten equity raising represents a landmark milestone and a key de-risking event for De Grey,” De Grey managing director Glenn Jardine said.
“This equity raising will underpin our ongoing project debt financing workstreams which are progressing well.
“The significant level of support received from key stakeholders to date provides strong validation of the high-quality nature of Hemi and our strategy of becoming a material Australian gold producer.”
The equity raising will result in the issue of 545,482,954 new ordinary fully paid shares, representing approximately 29 per cent of existing De Grey shares on issue.
De Grey’s 100 per cent owned Hemi project has a mineral estimate of 10.5 million ounces and currently comprises six main zones – Aquila, Brolga, Crow, Diucon, Eagle and Falcon.
Ongoing exploration across the deposits is aimed at shoring up a mine life of at least 15 years.
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