Far East Gold's Successful Placement and Share Purchase Plan Announcement
FAR EAST GOLD LTD (FEG) Share Update July 2024 Tuesday 30th
Far East Gold Announces $2.3M Placement and New Share Purchase Plan
Far East Gold Ltd (ASX: FEG), an Australian copper-gold exploration company, has announced a successful placement raising $2.3 million and the launch of a Share Purchase Plan (SPP) aiming to raise an additional $2 million.
Instant Summary:
- Raised $2.3 million through a placement at $0.136 per share.
- Share Purchase Plan (SPP) to raise up to $2 million opens on 1 August.
- Funds to be used for Woyla Project, Trenggalek Project, Idenburg Project, and general working capital.
- Discounted offer price of $0.136 per share, 24.44% below last closing price.
- Settlement expected on 7 August, with shares trading from 8 August.
Successful Placement
Far East Gold Ltd (FEG) has successfully raised $2.3 million through a placement of 16,911,764 new shares at an issue price of $0.136 per share. The placement received strong support from sophisticated and professional investors, with shares offered at a significant discount of 24.44% to the last closing price on 26 July 2024.
The funds raised will be allocated to several key projects, including the Woyla Project Maiden Resource, the Trenggalek Project Phase 1 Drilling Program, and the Idenburg Project JORC 2012 resource upgrade. Additionally, the funds will support general working capital and cover the costs of the offer.
Share Purchase Plan (SPP)
Following the successful placement, Far East Gold has launched a Share Purchase Plan (SPP), giving eligible shareholders the opportunity to apply for up to $30,000 each in shares at the same discounted price of $0.136 per share. The SPP aims to raise up to $2 million and will open at 10 AM AEST on 1 August 2024.
The offer price represents a 24.44% discount to the last closing price and a 20% discount to the 5-day volume-weighted average price (VWAP) before the SPP announcement. The SPP will close at 5:00 PM AEST on 14 August 2024, with new shares expected to be allotted and issued on 21 August 2024.
Use of Funds
The proceeds from the placement and SPP will be used to advance several key projects:
- The Woyla Project Maiden Resource, incorporating recent promising drilling results.
- The Trenggalek Project Phase 1 Drilling Program at the highly prospective Sumber Bening prospect.
- The Idenburg Project JORC 2012 resource upgrade, utilizing historical data and recent exploration advancements.
- General working capital and the cost of the offer.
The successful placement and the launch of the SPP are positive developments for Far East Gold. The funds raised will enable the company to advance its key projects, potentially leading to significant resource upgrades and exploration successes. The discounted offer price may attract additional investor interest, but the dilution effect could temper immediate stock price gains.
Investor Reaction:
Analysts are likely to view the successful placement and SPP as positive steps for Far East Gold, as they provide the necessary capital to advance key projects. However, the dilution effect and the discounted offer price may lead to mixed reactions from existing shareholders.
Conclusion:
Far East Gold's successful placement and the launch of the Share Purchase Plan represent significant milestones for the company. Investors should monitor the progress of the Woyla, Trenggalek, and Idenburg projects, as well as the overall market reaction to the SPP. Participating in the SPP could provide a valuable opportunity for eligible shareholders to increase their holdings at a discounted price.