Investors appear to be backing Sheffield Resources’ decision to spin out its secondary gold and base metal assets into a new company and list it on the ASX.

Newly created Carawine Resources has closed its $7 million initial public offering heavily oversubscribed following strong interest from new investors and existing Sheffield shareholders.

“This is a great result for Sheffield shareholders and for Carawine, with the strong interest confirming our belief that spinning out these assets into an independent exploration company is the best way to maximise their value,” Sheffield boss Bruce McFadzean said.

Sheffield’s primary focus is its Thunderbird mineral sands project in the Canning Basin of Western Australia.

Carawine’s suite of exploration projects include the wholly owned Jamieson gold-copper-silver-zinc project in Victoria, the Oakover copper-cobalt project and the Paterson copper-cobalt and gold-copper project in Western Australia.

The company also owns a 49 per cent stake in the Fraser Range nickel-copper-cobalt-gold project. Independence Group owns the remaining 51 per cent and is earning 70 per cent by spending $5 million on exploration over 5 years.

Having now raised the maximum $7 million under its IPO, Carawine anticipates it will light up the boards of the ASX on December 14.