Shares in Nedlands-based Australian Gold and Copper were down by 7 per cent early on Wednesday, following news the company plans to raise $11 million.
AGC eventually closed trade at 39 cents per share, down 6 per cent. Six days ago, its shares were 56 cents a piece.
The Glen Diemar-led company told the market that proceeds from the raise would primarily be allocated towards the acceleration of drilling at its Achillies prospect – within its South Cobar project – located in New South Wales.
Under the placement, the junior exploration company will issue 34.37 million shares in across a two-tranche placement, at an issue price of 32 cents per share.
The issue price represents a 22.9 per cent discount to AGC’s final closing price of 41.5 cents per share on May 27 – and also an 8.8 per cent discount to the company’s 10-day volume weighted average price on the same date.
Canaccord Genuity was appointed joint lead manager of the placement.
“The company is very well funded to further develop our recent discovery at Achilles,” Mr Diemar said.
“We look forward to receiving assays from the outstanding six reverse circulation holes and commencing our planned exploration program to expand this already significant discovery.”
AGC confirmed major shareholder, Hong Kong-based Delin Mining Group Cooperation, had committed to subscribing for additional new shares.
As it stands, Delin holds a 55 per cent stake in AGC.
Earlier this month, the junior explorer said it had recently completed its follow-up reverse circulation drilling program at Achilles, with positive assays from several holes.
Along with quality gold grades, drill hole A3RC030 returned silver intercepts resulting in overgrade levels in excess off 3,000 grams per tonne – a mark unable to be analysed by an Australian laboratory.
AGC said the next phase of drilling at Achillies would likely include additional reverse circulation drilling along with increased diamond drilling.
