CAPITAL MARKETS

Auteco raises at a premium

AUTECO Minerals has raised A$5.1 million to kick off exploration at the Pickle Crow gold project in Ontario.

 Auteco's Pickle Crow project in Ontario

Auteco's Pickle Crow project in Ontario

The company will place 145.7 million shares to new and existing domestic and offshore institutions and sophisticated investors.

The placement was conducted at 3.5c per share, a 2.4% premium to the 10-day volume-weighted average price.

Canaccord Genuity was lead manager and bookrunner.

The placement will be conducted in two tranches, with the second requiring shareholder approval.

Directors will also seek approval to subscribe for $225,000 worth of shares.

Auteco had $1.15 million cash at the end of March after raising $1.2 million at 0.8c in January, with 40% taken up by directors.

Non-executive director Steve Parsons has spent $130,255 buying Auteco shares on-market in April alone.

Executive chairman Ray Shorrocks bought $13,000 worth of shares on-market earlier this month.

Shorrocks said the strong interest shown by leading institutional investors in the placement was a huge endorsement of the Pickle Crow project and the current gold market environment.

"The proceeds raised enable us to begin our maiden drilling program at Pickle Crow, where we will initially be focusing on high-grade gold targets," he said.

"We look forward to releasing these assay results as received. In addition, we are expecting to release a JORC 2012 compliant resource during this calendar quarter."

Shorrocks was chairman of Bellevue Gold until last year. Parsons is managing director of Bellevue.

Bellevue chief geologist Sam Brooks is Auteco's technical director, while chief financial officer Michael Naylor is also on the board of Auteco as a non-executive director.

Auteco's maiden program will comprise 5000m of drilling to test high-potential walk-up targets.

The company agreed to acquire up to 80% of the project from First Gold Mining in January.

The project produced 1.5 million ounces at 16 grams per tonne gold until it closed in 1966, and has very little exploration since.

Shares in Auteco rose 7.5% to 4.3c, close to the 52-week high of 4.6c reached in February.

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