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Mustang Resources has closed its sales office in Mauritius and relocated to Thailand after its disastrous maiden ruby auction last year.

Mustang (ASX:MUS) told investors today it has opened a smaller, cheaper sales and marketing office in Chanthaburi, Thailand.

The company fell from grace at the end of October when reports began to leak out from its inaugural ruby auction that less than half of the lots sold.

The auction was well-hyped before it took place and the failure saw Mustang’s share price drop by 69 per cent in a single day and the exit of head honcho Christiaan Jordaan not long after.

Shares gained ground on Tuesday following news of the company’s new sales and marketing strategy — they were up 4 per cent at 2.6c.

MUS shares over the past six months.
MUS shares over the past six months.

Mustang has now moved its ruby inventory of 333,184 carats to the Chanthaburi office where they will be re-parcelled and prepared for sale.

Ruby reported about $1 million in sales receipts last quarter — but spent $4.5 million in “exploration and evaluation”.

It had $1.6 million in the kitty at the end of 2017 and is in the process of raising another $4.4 million.

The company says Thailand is considered the world-leader in trading and “beneficiation” of coloured gemstones, especially rubies and sapphires.

Beneficiation is the treatment of raw material to produce a higher quality product.

Since the 15th century, Chanthaburi and Bangkok have been the main trading and beneficiation centres for the coloured gemstone industry in Thailand.

Stockhead is seeking comment from Mustang.