Desert Metals faces capital dilution risk with new entitlement offer amid ongoing drilling

Entitlement Offer Details

Desert Metals Limited (ASX:DM1) has announced a pro-rata non-renounceable entitlement offer to its shareholders, providing one new option for every two shares held as of the record date. The new options are priced at $0.001 each and are exercisable at $0.015 on or before 31 December 2027. The offer aims to raise up to approximately $325,377 before costs.

The offer is designed to reward shareholder loyalty and provide an opportunity to participate in the company's potential future growth. CPS Capital Group Pty Ltd has agreed to fully underwrite the entitlement offer, ensuring the company will secure the targeted funds.

Use of Funds and Drilling Program

Funds raised from the offer will be allocated primarily to the ongoing aircore drilling program at the Tiogo and Kakalogo gold prospects, both located within the Tengrela South permit in northern Côte d’Ivoire. Additional funds will cover working capital and expenses related to the offer itself.

The initial phase of drilling at Tiogo is expected to be completed within two weeks from the announcement date, with first assay results anticipated in early May 2026. This drilling forms part of Desert Metals’ broader exploration strategy in the region, where it holds an 80% interest in the Tengrela South project.

Offer Timetable and Regulatory Compliance

The offer prospectus was lodged with ASIC and ASX on 7 April 2026 and will be dispatched to eligible shareholders around 15 April 2026. The offer opens on the same date and closes on 29 April 2026, subject to possible extension. New options issued under the offer will be quoted on the ASX, with quotation expected from 7 May 2026.

Shareholders interested in participating are advised to carefully review the prospectus and consult professional advisers as needed. The offer does not have a minimum subscription requirement, and applications must be made using the entitlement and acceptance form accompanying the prospectus.

Context and Company Background

Desert Metals is an ASX-listed gold exploration and development company focused on projects in Côte d’Ivoire, West Africa. The company holds majority interests in multiple permits, including the Tengrela South and Adzope projects, covering over 1,000 square kilometres. Recent exploration activities have included a 2,000-metre aircore drilling campaign at Tiogo, targeting untested mineralised zones, and previous high-grade gold intercepts reported at nearby prospects.

This entitlement offer follows a $1.25 million placement completed earlier in 2026, which supported expanded exploration programs in the region. The current offer is relatively modest in size but is fully underwritten, providing Desert Metals with additional capital to advance its drilling activities.