Perth-based gold explorer Red Mountain Mining is set to list on the Australian Securities Exchange after successfully completing an $8 million initial public offering.
Red Mountain said the IPO was oversubscribed by more than 50 per cent and received strong support from institutional investors in Australia, Hong Kong and China.
The IPO was led by Cygnet Capital.
Red Mountain, which was established in 2006, is focused on acquiring and developing under-valued and under-explored gold projects in China.
Chairman Michael Wolley said the company had been examining gold projects in China for the past five years.
Its portfolio includes an operating gold mine at Zhongqu, in China’s Gansu province, and an advanced exploration project at Diebu, also in Gansu province.
Red Mountain said it had binding acquisition agreements to purchase 51 per cent of the Zhongqu project and 90 per cent of Diebu.
“China is the world’s largest gold producer but the industry tends to use labour intensive mining techniques which restricts productivity,” Mr Wolley said.
“Our strategy is to acquire controlling interests in privately held ‘under-developed’ operating gold projects and gain significant production upside for our shareholders and JV partners.
“By using modern exploration and mining methods commonly adopted in Australia, we will be looking to increase our resource base, improve safety and enable access to ore bodies that would have otherwise been dormant.”
