Spartan Resources (ASX:SPR) Raises A$220 Million for Dalgaranga Project
Placement Overview
Spartan Resources Limited (ASX: SPR) has announced firm commitments to raise A$220 million through an institutional placement. The placement is set at A$1.32 per share, reflecting a discount of approximately 4.9% to the five-day volume weighted average price and about 7.0% to the last closing price of A$1.42. Notably, Ramelius Resources Limited, Spartan’s largest shareholder, has participated in this offering, increasing its ownership to 19.9%.
Use of Funds
The capital raised will significantly boost the Dalgaranga Gold Project’s operational readiness. Spartan plans to invest A$130 million in underground mine development and A$70 million on infrastructure and mill modifications over the next 18 to 24 months. This includes early works for a paste plant and the addition of a ball mill. Investing A$21 million is also intended for drilling campaigns to expand the resource across the Gilbey’s Complex.
Future Outlook
Spartan regards this placement as a critical step towards resuming production and positioning itself as a significant mid-tier high-grade gold producer in Australia. Simon Lawson, Interim Executive Chairman, stated, “This is a pivotal capital raising for Spartan which puts us firmly on track to re-start production and become the next significant mid-tier high-grade gold producer on the ASX.”
Feasibility Study
A feasibility study is underway, aiming for release by mid-2025, to explore new opportunities for expansion and resource confirmation, particularly at the Never Never and Pepper deposits.
Conclusion
With a pro-forma cash position of A$290 million upon completion of the placement, Spartan is well-capitalised to execute its development strategy and unlock the full potential of its gold assets at Dalgaranga. Trading in Spartan shares has resumed on the ASX as of today.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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