GWR spinout hits ASX boards

The spinout company of GWR Group focused on exploring for gold in Western Australia has listed on the ASX after raising $7 million.

Western Gold Resources was spun out of GWR’s Wiluna West gold project, located in the northern Goldfields.

The business, based in West Perth, completed an initial public offering in June, through which it issued 35 million shares at a price of 20 cents each. The raise was led by GTT Ventures and Lazarus Corporate Finance.

Western Gold has had a quiet start to its first day of trading, with its share price lowering to 18 cents at 14:30pm before closing at 20 cents.

It has roughly 62.8 million shares on issue, implying a market capitalisation of about $12.6 million.

In April, GWR announced plans to demerge its Wiluna West project into a new listed entity, having said the time was right to take advantage of the buoyant gold price, which has remained above $US1,600 per ounce this year.

The company – which operates the nearby C4 iron ore mine – said its shareholders had overwhelmingly approved the demerger.

Western Gold is led non-executive chairman Gary Lyons, also the chair of GWR Group, and managing director Warren Thorne.

The spinout says Wiluna West has near-term production potential and scope for increasing gold resources, while noting the project's closeness to significant infrastructure.

“We have identified the Eagle, Emu, Gold King and Comedy King deposits as priority drilling for providing an opportunity to increase mineral resources, with all deposits remaining open at depth and some open along strike,” Mr Thorne said today.

“We look forward to growing shareholder wealth and exploring the full potential of these fantastic assets with the focus of significantly expanding our gold deposits.”