Dome Gold Mines has proposed a new AUD$2 million unsecured convertible note offering to fund the final stages of its Sigatoka feasibility study, a mining lease application and renewed Fiji exploration. The notes carry 12% annual interest and could convert into up to 20 million shares if fully issued and converted.
- AUD$2 million proposed raise from sophisticated investors
- Unsecured notes carry 12% annual interest over three years
- Conversion price fixed at AUD$0.10 per share
- Funds aimed at Sigatoka feasibility work and mining lease application
- Airborne geophysics planned for copper, gold and silver targets at SPL1452
Dome targets Sigatoka funding gap
Dome Gold Mines Ltd (ASX:DME) is proposing to raise up to AUD$2 million through unsecured convertible notes, putting fresh funding behind the final stages of its Sigatoka heavy mineral sands project and a return to exploration in Fiji.
The offering is restricted to sophisticated investors. The notes would run for three years, pay 12% annual interest and convert into fully paid ordinary shares at AUD$0.10 each. If the full amount were raised and every note converted, the maximum implied issue would be 20 million shares, although the announcement does not confirm that the offer has been fully subscribed or issued.
High-cost capital tied to project milestones
Dome says the proceeds would fund completion of the Sigatoka Feasibility Study, finalisation and submission of the application for a Sigatoka Mining Lease, and working capital for its Sydney office and Fiji operations. The company says drilling for an initial resource estimate has already been completed and that the feasibility study is in its final stages.
The proposed financing comes after the company had outlined a previous $3 million note proposal, according to recent coverage, making confirmation of the actual amount secured an important distinction. At 12%, a fully drawn AUD$2 million would carry a simple annual interest cost of AUD$240,000 before any conversion or repayment, while the notes remain unsecured and rank alongside other unsecured creditors.
Nadrau exploration set for geophysical restart
A portion of the capital is earmarked for quotes and completion of an airborne geophysical programme over copper, gold and silver targets on SPL1452. Chairman Jack McCarthy said the company saw an opportunity to resume exploration at Nadrau, where current and historical work had identified widespread anomalies, and to use newer geophysical methods to rank targets for follow-up geology and drilling.
The notes can be converted early at the holder’s election with at least 30 days’ notice, or at maturity. Dome can also repurchase them before conversion by giving 60 days’ notice and paying face value plus accrued interest, although a holder may issue a conversion notice after a repurchase notice.
Funding confirmation is the immediate test
The proposal gives Dome a defined route to fund permitting and exploration, but it also leaves several shareholder-sensitive questions open: how much capital will actually be committed, when will the notes be issued, and whether conversion at AUD$0.10 would dilute existing holders. The next meaningful markers are confirmation of subscriptions, progress on the feasibility study and the Sigatoka Mining Lease application.
Bottom Line?
The raise could fund Dome’s next Sigatoka milestones, but its 12% coupon, unsecured ranking and potential 20 million-share conversion make the final subscription outcome critical.
Questions in the middle?
- Will sophisticated investors subscribe for the full AUD$2 million, or will the offer close below its target?
- How quickly can Dome complete the Sigatoka Feasibility Study and submit its Mining Lease application?
- Will the Nadrau airborne survey identify targets that justify follow-up drilling and further capital?