IPO alert: Star Minerals shines on ASX debut, shares surge over 7%

The Australian share market closed marginally higher in volatile trade on Wednesday as gains in telecom and health care stocks were offset by losses in consumer staples and utilities companies. The top gainers on the ASX were telecom services company Uniti Group (ASX:UWL) and plumbing parts business Reliance Worldwide (ASX: RWC). On the flip side, technology solutions provider Codan (ASX: CDA) and dairy business The A2 Milk Company (ASX:A2M) were among top losers.

On the initial public offering (IPO) front, mineral exploration company Star Minerals (ASX: SMS) made its debut on the domestic bourse. The Western Australia-based firm received positive response from investors, with stock price climbing as much as 7.5% during the session.

The gold explorer closed the first day of trade at AU$0.215 against an issue price of AU$0.20. On the volume front, 1.16 million shares worth AU$236.1K changed hands over the counter.

Star Minerals raises AU$5M via IPO

Star Minerals shares commenced trading on the ASX today after successfully raising AU$5 million in its IPO. The gold and copper focused exploration and development company issued 25 million shares at an offer price of 20 cents per share. The issue was oversubscribed on the back of strong demand for its priority and general offers.

The IPO garnered strong support from shareholders of Australian Vanadium (ASX: AVL) and Bryah Resources along with Magnolia Capital Group’s cornerstone investment of AU$2.5 million.

Following the listing, the company will have 53 million ordinary shares on issue, at an enterprise value of AU$5.2 million and a market capitalisation of AU$10.2 million with the top 20 shareholders holding 76.3% of ordinary shares on issue.

The company intends to use IPO proceeds to explore and develop the Tumblegum South gold assets in the Bryah Basin, where drilling activities are set to commence soon.

Commenting on the development, Star Minerals’ CEO Greg Almond said: “We are delighted with the strong support shown by AVL, Bryah and our new investors, and look forward to putting our people to work on the strategy we have outlined. We believe our investors have recognised both the strong potential of our assets, and the methodical approach we are taking.”

“We will hit the ground running at Tumblegum South, and to be able to leverage off the great
work done by AVL and Bryah in the area puts us ahead of the pack,” Almond added.