QMines’ $7.5M Placement Hinges on Shareholder Approval Amid Growth Plans
QMines Limited has raised $7.5 million through a strongly supported placement to accelerate exploration at its Mt Mackenzie, Mt Chalmers, and Develin Creek projects, positioning the company for growth in gold and base metals.
- Placement raised $7.5 million with strong investor demand
- Funds to accelerate drilling at Mt Mackenzie gold-silver project
- Additional capital allocated for Mt Chalmers land acquisition and debt repayment
- Placement includes two tranches, second subject to shareholder approval
- Experienced brokers Canaccord and Wilsons led the placement
Strong Capital Raise Signals Confidence
Queensland-focused explorer QMines Limited (ASX, QML) has successfully secured $7.5 million through a two-tranche placement, underscoring robust investor confidence in its portfolio of gold, silver, copper, and zinc projects. The placement attracted significant support from both existing shareholders and new sophisticated investors, reflecting market optimism about the company’s growth trajectory and asset quality.
Accelerating Exploration at Mt Mackenzie
The bulk of the funds will be directed towards an extensive drilling program at the high-grade Mt Mackenzie gold and silver project. Previous drilling results have demonstrated promising mineralisation, including intercepts such as 100 metres at 2.86 grams per tonne gold and 13 grams per tonne silver. The upcoming program aims to infill and extend these zones, potentially expanding the resource base and enhancing the project's development prospects.
Strategic Use of Funds Beyond Drilling
Beyond exploration, QMines plans to deploy capital to repay outstanding loans, purchase additional freehold land at Mt Chalmers to mitigate future operational risks, and support working capital needs. Mt Chalmers, a historic high-grade copper-gold mine, along with the Develin Creek project, which hosts copper, zinc, gold, and silver, remain key pillars in QMines’ strategy to transition towards sustainable copper production.
Placement Structure and Governance
The placement involves issuing up to 136.4 million shares at 5.5 cents each, split into two tranches. The first tranche of approximately 81 million shares will be issued under existing placement capacities, while the second tranche of about 55 million shares awaits shareholder approval. Canaccord Genuity and Wilsons Corporate Finance acted as joint lead managers, earning a 6% fee and 10 million options as part of their engagement.
Management Perspective
Executive Chairman Andrew Sparke expressed satisfaction with the strong demand, highlighting it as a testament to the quality of QMines’ assets and aggressive growth plans. He emphasized the company’s commitment to demonstrating the scale and development potential of its projects, particularly Mt Mackenzie, which is poised for a significant drilling campaign.
Bottom Line?
With fresh capital secured, QMines is set to unlock further value from its Queensland projects, but shareholder approval for the second tranche remains a key upcoming milestone.
Questions in the middle?
- Will the shareholder vote approve the second tranche of the placement?
- How will upcoming drilling results at Mt Mackenzie influence the company’s valuation?
- What is the timeline for potential production or resource upgrades at Mt Chalmers and Develin Creek?
