A new gold miner Aurumin Limited (ASX:AUN) marked 75% listing gain

3 min read | December 10, 2020 01:08 PM AEDT | By Team Kalkine Media

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A new gold miner Aurumin Limited (ASX:AUN) marked 75% listing gain

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Summary

A new gold miner Aurumin Limited (ASX:AUN) made its debut with a 75% gain.

The company raised $7 million via the issue of 35 million shares at $0.2 per share.

The raised funds would be sufficient for the next two years of operation; however, more funds might be needed due to nil operating revenue.

On 9 December 2020, a new gold miner Aurumin Limited (ASX:AUN) stepped into the listed Australian market. The share price listed on the exchange at A$0.35 compared to the issue price of A$0.2, giving a healthy gain of 75%.

Image Source: Shutterstock

However, the stock couldn’t hold its ground and got victim of profit booking, which dragged the price to A$0.28, which was also the lowest price of the day (as at 1:03 PM) on 9 December 2020. The stock is currently trading at $0.350 per share (AEDT: 12:58pm), up by 16.67%, on 10 December 2020.

IPO Details

The company has successfully raised a total of $7 million via the issue of 35 million shares at $0.2 per share. Apart from the equity shares, 2 million unquoted options have also been offered under the Lead Manager Offer at an issue price of $0.0001 each. The exercise price of these options is $0.30 with an expiry date of 31 July 2024.

Image Source: Shutterstock

After the issue, the total equity shares of the company would stand at 86.4 million.

Use of Funds

For the first year, a total of $1.9 million from the proceeds from the IPO would be utilized towards the company's mineral exploration activities. The corporate overheads worth $847,000 is also planned to be paid via the proceeds. The working capital of $351,000 would also be utilized via the raised funds.

Image Source: Aurumin’s ASX update, Dated 8 December 2020

For the second year, another $2.06 million would be sent towards the exploration activities with $600,000 of acquisition assessment. The working capital and corporate cost would require the same amount of funds as in the first year.

Based on the above allocation of the funds, the company would be having sufficient funding for the operations for the next two years.

Future capital requirements

Currently, the company is working at no operating revenue and is unlikely to generate the same until its projects are successfully developed, and production commences. Therefore, the future capital requirement might arise, which will depend on a host of factors, including business development activities.

The company may undertake additional offerings of Shares and securities convertible into shares in the future to fulfil this need.

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