Mako Gold Ltd (ASX:MKG) has received binding commitments for a two tranche placement to raise A$3.25 million before costs, funding further exploration at the Napié Gold Project in Côte d’Ivoire, West Africa.

The placement was strongly supported by existing shareholders and introduced several new, high-quality domestic and international investors to the Mako share register, further validating the Napié project and Mako’s tier-1 exploration team.

A strong indication of the demand came with the receipt of firm commitments for in excess of A$6.4 million.

“Overwhelming demand”

Managing director Peter Ledwidge said: “The overwhelming demand from institutional and sophisticated investors is a strong endorsement of Mako’s flagship Napié gold project and its exploration team.”

This team has a track record of success in West Africa having discovered in excess of 2.6 million ounces of gold for Orbis Gold leading to a subsequent circa A$180 million takeover by TSX-listed African gold producer SEMAFO (TSE:SMF).

Ledwidge said: “This capital raising provides us with balance sheet support for our extensive exploration program at Napié.

“With a strike length of 30 kilometres, multiple mineralised structures and less than 10% explored to date, we believe the Napié has potential to host multi-million-ounce gold deposits.”

Funded to execute systematic exploration

Together with existing cash reserves of around A$600,000 and proceeds of A$1.1 million from the recent divestment of the Niou Project, the placement ensures Mako is funded to execute a systematic exploration and growth strategy.

The company plans to extend existing high-grade mineralisation, to test multiple high priority regional prospects and deliver a maiden resource estimate at the Napié project.

Two-tranche placement

This placement will comprise the issue of 65 million shares at an issue price of 5 cents per share as follows:

  • Tranche-1 of the placement will comprise 11.3 million new shares, is not subject to shareholder approval and will fall within the company’s placement capacity under ASX Listing Rule 7.1 and 7.1A; and
  • Tranche-2 will comprise up to 53.7 million new shares and will be issued subject to shareholder approval at a general meeting to be held on or around early July.

Drilling is expected to begin in early July and continue through the remainder of 2020.