Dragon Mountain Gold raises $6.3m

South Perth-based Dragon Mountain Gold Ltd has raised $6.32 million via the placement of 13.45 million shares at 47 cents each with a range of select institutional groups and sophisticated investors in Australia and the UK.

DMG remains focused on the development of its projects in China, particularly at the major Lixian gold project which is currently in the advanced drill-out stage.

The funds raised by the direct placement will enable DMG to increase its drilling program currently underway at Lixian to accelerate the reclassification of existing mineralisation to JORC compliant resource status. It will also provide the working capital to investigate other operational and corporate options to enhance the company's growth.

DMG said the placement further strengthened the depth and breadth of the company share register and was a strong endorsement of its strategy in China.

The company intends to offer all eligible shareholders an opportunity to participate in a share purchase plan to take advantage of the current low share price.