Korab launches placement after withdrawing spin-out plans

Fresh from withdrawing plans to list its gold assets on the ASX, Korab Resources has completed a $1.78 million capital raising to fund exploration and development activities at its projects in Western Australia and the Ukraine.

The Perth-based exploration firm said proceeds from the share placement, priced at 13.5 cents per share, would be used to advance mining and exploration at the Borbrikovo gold project in the Ukraine.

Funds will also be applied to exploring the Melrose gold project in the eastern Goldfields and the Geolsec phosphate project in the Northern Territory.

The capital raising follows last week’s announcement that Korab had withdrawn plans to list its Ukrainian subsidiary, Lugansk Gold, and its Goldfields focused exploration company, Melrose Gold, on the ASX.

The company said it was no longer seeking to list the assets because of volatile domestic and global market conditions.

Executive chairman Andrej Karpinksi said the share placement had received strong interest from institutional and sophisticated investors.

“To have received such strong interest in this capital raising and to have completed the raising at no discount to our last traded price is seen as a strong endorsement of the company’s portfolio of assets and of our future strategic direction,” he said.

“These funds will provide us with a significant opportunity to realise the full potential from our gold and phosphate projects.

“They will also give us the flexibility to pursue our revised corporate strategy, being to continue to develop our projects through to production or to seek other successful value creation methods to derive value for Korab shareholders.”