This WA gold company wants to hit it out of the park with $11.3m raising
Special Report: Perth-based gold developer Bardoc Gold (ASX: BDC) wants to supercharge its Australian gold strategy, unveiling a capital raising of up to $11.3 million this morning.
Bardoc – which burst onto the junior WA gold scene over the past 18 months with a series of M&A transactions – has made it clear it is in a hurry to build a large resource base in WA’s prolific North Kalgoorlie district as the foundation for a long-term gold business.
Now it has added serious weight to the strategy by raising $7 million via a share placement “to existing and new strategic investors” and launching a 1-for-10 rights issue to existing shareholders (all at a 4c issue price) to raise up to an additional $4.3 million.
Not bad for a $46 million company against the backdrop of what is widely acknowledged as a tough market for securing risk capital.
But there’s more to the Bardoc raising than meets the eye.
Bardoc (formerly Spitfire Materials) was founded by Neil Biddle and John Young, two of the original founding directors of the successful lithium miner Pilbara Minerals (ASX: PLS).
Today, they revealed that a third key member of the original Pilbara Minerals team is about to join the company.
Bardoc said the $7 million placement is underpinned by a “new international strategic investor group” associated with prominent Sydney-based business executive Mr Tony Leibowitz, who has participated in the placement and agreed to join the Bardoc board as non-executive Chairman.
Mr Leibowitz – a former global partner with PricewaterhouseCoopers and well-known figure in Australian and international business circles – was the founding Chairman and an early investor in Pilbara.
Together with Messrs Biddle and Young, he oversaw the corporate strategy which resulted in Pilbara’s transformation from a junior micro-cap explorer into a substantial new ASX-200 mining company with a market capitalisation of over $1.3 billion.
Bardoc said Mr Leibowitz “has a proven track record of providing the necessary skills and guidance to assist companies grow and generate sustained shareholder value.”
“This is essentially the same corporate team and investor group that got Pilbara Minerals off the ground in 2014 at a time when risk capital for junior explorers was extremely hard to come by,” said Mr Young, Bardoc’s Managing Director.
“Thanks to their support, we were able to implement a clear growth strategy at the time in the lithium space and back that up with a sustained drilling program that ultimately delivered in spades for shareholders.”
It’s a claim that would be backed up by many early investors in Pilbara Minerals (once dubbed the “millionaire factory” by one newspaper) who have celebrated outstanding returns.
Bardoc shareholders looking for a repeat of the aggressive Pilbara Minerals strategy which saw the company drill over 100,000m in the space of 2-3 years to build a world-class resource base at its Pilgangoora lithium-tantalum project.
Mr Young said the funds raised through the Placement and Entitlements Issue will be used to rapidly expand the current resource expansion drilling program at the company’s flagship 2.6 million ounce Bardoc gold project.
“We’ve got a $5-6 million exploration program already mapped out to drill several newly-identified opportunities where we see great potential to add ounces in the short term,” he said.
“With a strengthened balance sheet, we will also have the capability to pursue sensible and value-accretive acquisition and M&A opportunities at a time when the Australian gold sector has never been in better shape.
“In order to be successful as an Australian gold developer, we are aiming to build a resource inventory of scale and relevance as quickly as we can, to give ourselves the best opportunity of creating a sustainable gold business that will appeal to global investors.”