Western Australian gold explorer Kin Mining (ASX: KIN) will move into the next phase of exploration at its Cardinia gold project with a $13 million rights issue after rejecting a non-binding indicative offer (NBIO) from existing shareholder St Barbara (ASX: SBM).
In July, St Barbara outlaid $25.3 million to take a 19.78% stake in Kin.
It has now offered to acquire 100% of Kin at $0.16 per share. Kin closed yesterday at $0.105 per share.
Kin said it canvassed the views of major and substantial shareholders (other than St Barbara) who between them hold more than 25% of Kin’s shares and found the NBIO was not acceptable to them, and therefore would not have been approved by the required 75% of shareholders.
Plans to increase 1.28Moz gold inventory
The company says the $13 million raised will provide Kin with sufficient working capital to complete the next phase of “systematic” exploration work at Cardinia.
This will include the emerging new discoveries at the Mt Flora and Iron King prospects.
The 100% owned Cardinia gold project is located near Leonora in the highly prospective northeastern Goldfields region of Western Australia.
Last month Kin increased the mineral resource at one of the deposits, Cardinia Hill, to 106,000oz, raising the global mineral resource for the entire project to 31.1 million tonnes at 1.27 grams per tonne gold for 1.28 million ounces.
Exploration approach has paid off ‘in spades’
Kin managing director Andrew Munckton said the company has had “considerable” success converting its geological understanding into exploration results.
These, in turn, have then been converted into additional mineral resources.
The Bruno-Lewis resource has been expanded by 20% to 374,000oz.
“Our systematic approach to exploration has paid off in spades and given us a much better idea of where and how to target the next phase of drilling,” Mr Munckton said.
This will be designed to both define new resources and identify additional discoveries.
“Other targets across the land package have been identified by recent soil geochemistry and modern geophysical surveys over largely untested areas within the highly mineralised Cardinia area,” he added.
This ground will be covered by work programs stretching into 2022.