IPO watch: West Australian gold play Yandal moves closer to $5m float
West Australian gold explorer Yandal Resources is making its way to the ASX with the launch of a $5 million initial public offering.
The junior explorer (under ASX code ‘YAL’) will have a market cap of about $10.7m once it has completed its offer of 25 million shares at an issue price of 20c to raise the cash.
The junior explorer has already “received strong interest” from a strategic investor looking to acquire a 15 per cent stake in the company – “a great endorsement of the prospectivity of our projects and our management team”, Yandal managing director Lorry Hughes told Stockhead.
“This interest, as well as strong support from retail and sophisticated investors familiar with the potential within the Yandal Greenstone Belt is a great start to the IPO process,” he said.
“Our technical team is busy preparing a number of priority exploration programs at all of our projects, and drilling will start at the Gordans Dam gold prospect near Kalgoorlie in November to take advantage of a $30,000 Government EIS co-funding grant.”
The last time major exploration programs were run on Yandal’s tenements the gold price languished around $US500/oz; it is now more than double that at $US1200/oz ($1700/ oz).
Surrounded by some large gold mines — including the 10 million-ounce Jundee and 2.7 million-ounce Darlot operations — Yandal says its projects are prospective for large, Tier 1 deposits.
But it is also looking to make cash quickly by developing smaller gold deposits and trucking ore to third party processing plants – which reduces start-up costs significantly.
Yandal will join a throng of ASX listed small cap gold miners and explorers including Red 5 (ASX:RED), Blackham Resources (ASX:BLK), Bellevue Gold (ASX: BGL), Great Western Exploration (ASX:GTE), Renegade Exploration (ASX:RNX), and Echo Resources (ASX:EAR) who are all busy in the region.
Yandal is planning to lodge its prospectus with the ASX this week, and open the offer the following week for investors to download from its website.