Tight market conditions in the capital raising space among Australia’s resource stocks has claimed another victim with gold miner WPG Resources forced to scrap a $5.4 million cap raising.

Sydney-based WPG (ASX:WPG) advised that it had withdrawn its 1-for-8 pro rata non-renounceable entitlement issue to raise $5.4 million which the company announced back in June 2017.

At the time, new shares for the entitlement issue were priced at 4.8c per share. However, since that date the company’s share price has sunk, closing yesterday at 3.9c.

The company said today in a statement that the offer was no longer attractive to its eligible shareholders due to current market conditions and decided to withdraw the offer.

All application moneys will be refunded in full with no interest payable on refunded application monies. The company said it would coordinate with the Share Registry to process all cheques and bank transfers by 21 August 2017.

The $5.4 million entitlement issue was part of a total $12.6 million capital raising which included a heavily oversubscribed $7.2 million placement announced on 13 June 2017.

Funds raised by the entitlement issue were to go towards the expansion of the company’s Challenger mill in South Australia, mine development, exploration and for general working capital purposes.

Veritas Securities Limited was lead manager and Adelaide Equities acted as a corporate adviser for the entitlement issue.

During the June quarter, WPG produced 13,909 ounces of gold from its Challenger and Tancoola mining operations. This brought year-to-date production to 50,882 ounces, 2 per cent below the lower end of its guidance range of 52,000 – 56,000 ounces.

Shares in WPG were trading unchanged at 3.9c at 11.35am Tuesday AEST.