03/11/2021 - 14:00

Falcon seeks $30m ahead of listing

03/11/2021 - 14:00


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Chalice Mining’s gold spinout is seeking to list on the ASX next month, having launched an IPO to raise $30 million.

Falcon seeks $30m ahead of listing
Falcon's main focus will be on exploring the Pyramid Hill project in Victoria. Photo: Chalice Mining

Chalice Mining’s gold spinout is seeking to list on the ASX next month, having launched an initial public offering to raise $30 million.

This morning, Chalice announced its plan to demerge three gold projects into a separate listed entity called Falcon Metals had been lodged with the Australian Securities and Investments Commission, along with Falcon’s prospectus.

The West Perth-based explorer will issue between 30 million and 60 million shares through the IPO at 50 cents each to raise between $15 million and $30 million.

Bell Potter Securities is acting as lead manager to the raising.

The spinout projects are Mount Jackson and Viking, which are located in Western Australia, and Pyramid Hill in Victoria.

Chalice announced plans for the demerger in July, having said it would allow the company to focus on developing its Julimar nickel-copper-PGE project north-east of Perth.

It will seek shareholder approval for the demerger on December 3, with Falcon scheduled to list on the ASX on December 22.

In its prospectus, non-executive chairman Mark Bennett said Falcon would use the IPO proceeds to explore and fund the potential development of its projects, pay corporate and administration costs, and fund general working capital.

“The demerger will deliver an exciting, newly incorporated, standalone gold exploration company in Falcon, which will be focussed on the advancement of the spin-out projects,” he said, noting Pyramid Hill would be the main focus for Falcon.

The project covers an area of more than 6,500 square kilometres in Bendigo, with the region also home to Kirkland Lake Gold’s Fosterville mine.

Mr Bennett said the project area was underexplored.

“The board of Falcon Metals believes that it will have sufficient resources to further develop these assets optimise their potential value,” he said.

“The company is noteworthy for its dedicated board and management team, which collectively have many years of experience within the resources industry and a track record of making and financing valuable mineral discoveries.”

Mr Bennett’s experience includes as a non-executive director of Todd River Resources, a director of IGO and the executive chairman of S2 Resources.

Chalice managing director Alex Dorsch also sits on the Falcon board, as a non-executive director.

The demerger will occur via an in-specie distribution of shares, which Chalice shareholders to receive one Falcon share for every 3.025 shares held in Chalice.

Chalice’s shareholders will also be prioritised in the IPO, on a one-for-5.882 basis.

Shares in Chalice closed up 1.4 per cent to trade at $6.49 each.


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