Medallion Metals Ltd (proposed ASX:MM8) is looking to build a long life, high margin gold business in Australia, with the initial focus of advancing its Ravensthorpe Gold Project to final investment decision and ultimately, production.
Medallion’s investment highlights include:
- Numerous immediate growth opportunities to increase shareholder value through extending the current Ravensthorpe Gold Project known Mineral Resources, advancement of near mine exploration targets and updating the already robust Feasibility Study (“FS”) completed in May 2020 to reach a final investment decision;
- Opportunity to become a near to medium term, high margin gold producer, targeting 80,000 ounces of production per annum;
- Additional multiple organic growth opportunities within the extensions of the Archean and Proterozoic geological settings in Western Australia; and
- Experienced board and management team with extensive mining development experience.
The Ravensthorpe Gold Project and Jerdacuttup Project are situated in the Southern Goldfields-Esperance region of Western Australia, approximately 550 km southeast of Perth.
The company was incorporated in 2015 for the express purpose of acquiring the Great Southern Project in the Goldfields-Esperance region of Western Australia from Silver Lake Resources Ltd (ASX:SLR).
This project comprises:
- The Ravensthorpe Gold Project - approximately 674,000 ounces of gold of JORC Code compliant Mineral Resources estimates (of which approximately 270,000 ounces are JORC Code compliant probable Ore Reserves estimates). A FS completed in May 2020 indicated there are robust economics for open pit and underground mining and processing of mined ore on-site; and
- The Jerdacuttup Project - which is prospective for base and precious metals, and contains JORC Code compliant Mineral Resources estimates.
The Company acquired the Projects for $5.5 million in 2016.
Since then the Company has spent approximately $15.3 million on resource definition drilling, regional exploration, testwork, feasibility studies (including the FS), and activities associated with environmental and statutory approvals.
The funds raised in this Offer are primarily intended for use at the Ravensthorpe Gold Project to undertake further resource drilling, pre-development activities, updating and optimising the FS and advancing the Company towards making a final investment decision.
Funds raised in this Offer will also be used to advance exploration and studies at the Jerdacuttup Project (the Company may pursue a farm-out, spinout/IPO or sale opportunity under appropriate terms).
Funds raised will also be applied to additional exploration across both Projects and for working capital.
Approximately $0.9 million will be used to partially repay a loan extended by the Company’s largest existing shareholder that has contributed to funding the Projects to date as well as service interest payments associated with amounts that remain outstanding under loan post listing.
The Offer
Medallion Metals Ltd (ACN 609 225 023) is issuing an initial public offer of 37.5 million new Shares at a price of $0.40 per Share to raise a minimum of $15.0 million, with the ability to accept up to $5.0 million in oversubscriptions.
The offer of the securities are made in, or accompanied by, a copy of the Disclosure Document which can be obtained on The Company website.
Ord Minnett Limited and New Holland Capital Pty Ltd are the Joint Lead Managers to the Offer.
Anyone who wants to acquire the securities will need to complete the application form that will be in or will accompany the Disclosure Document.
Before making an investment decision, potential investors should read the Disclosure Documents entirely, and seek professional financial advice.
Investors should be aware that there are risks associated with an investment in this Company.
A complete set of risks associated with an investment in the Company is included in Section 6 of the Disclosure Document. Investors should consider those risks carefully in deciding whether to invest in the Company.
Key Offer Statistics
| Item | Minimum Subscription $15 million | Maximum Oversubscription $20 million |
|---|---|---|
| Issue price per Share under the Offer | $0.40 | $0.40 |
| Existing Shares on issue at date of Prospectus | 119,736,850 | 119,736,850 |
| Total number of Shares offered under the Offer | 37,500,000 | 50,000,000 |
| Total number of Shares on issue at ASX Listing | 157,236,850 | 169,736,850 |
| Total Options on issue at ASX Listing | 4,220,000 | 4,220,000 |
| Indicative undiluted market capitalisation at ASX Listing | $62,894,740 | $67,894,740 |
| Cash proceeds to be received under the Offer (before costs) | $15,000,000 | $20,000,000 |
| Ownership by Offer investors under Offer at ASX Listing | 23.8% | 29.5% |
Indicative Timetable
| Event | Date |
|---|---|
| Closing Date of the Offer | 5pm (WST) 7 December 2020 |
| Issue of Shares (Completion of Offer) | 17 December 2020 |
| Expected date for dispatch of Holding Statements | 21 December 2020 |
| Expected date for Admission to Official List and quotation of Shares on the ASX | 24 December 2020 |