Dacian to raise $110m for Mt Morgans

Dacian Gold has reignited plans to undertake a large equity raising, announcing today a $110 million placement and entitlement offer to fund development of its Mt Morgans gold project near Laverton.

Dacian will raise $15.4 million through the placement of 8 million shares at a price of $2 per share, and will raise a further $94.4 million through a non-renounceable entitlement offer at the same price.

The price of the raising represents an 11.9 per cent discount to the company’s last closing price, and is 50 cents per share lower than what it planned to price a $100 million entitlement offer in December, which was put on ice.

It had originally priced that entitlement offer at $2.75 a share.

The majority of the proceeds will be used to fund construction and development of Mt Morgans, including a new 2.5 million tonnes per annum CIL treatment facility.

Construction work began last month after Dacian secured a $150 million facility with three banks. First gold production is expected in the first quarter of next year.

“The equity raising completes the last piece of the funding package required to complete the construction of the Mt Morgans gold project through to first gold production,” Dacian chairman Rohan Williams said.

“We can now focus all our attention on continuing project construction and mine development at Westralia and Jupiter, keeping us on track to achieve first gold production in Q1 2018.

“It will also fund continued exploration targeting more discoveries on our extensive and highly prospective land-holding at Mt Morgans, where we see significant potential to continue to grow our gold inventory.”

Dacian shares were unchanged at $2.27 each at 10:40am.