GOR (ASX) Ann: Ceasing Participation in Sales Process

Originally posted by gbgirl ↑

NO very interesting we bet GOR want a J?V or T?O with DEG but NO>
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Monsters of Rock: De Grey secures $600m of De Green but where is Gold Road?
Mining
2 hours ago | Josh Chiat

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De Grey Mining announces $600m equity raise for Hemi gold mine

Where is Gold Road, near 20% owner of the $2.3bn developer?

Leo Lithium sells out of Goulamina to Ganfeng amid Mali Govt woes

Gold Road Resources (ASX:GOR) is yet to reveal its intentions as De Grey Mining (ASXEG) sews up $600 million in fresh equity to bankroll its world class Hemi gold project.
The status of the Gruyere gold mine half-owner is a matter of conjecture in analyst circles, especially after the company pulled out of the race for a 40% share in Equinox Gold and Orion’s Greenstone Gold Mines in Canada.
It has yet to settle on a second project since Gruyere was brought to life half a decade ago.
GOR has maintained a near 20% stake in De Grey and its 10Moz plus Hemi mine–- which a DFS last year suggested would produce 530,000ozpa over its first decade – since acquiring Ed Eshuys’ DGO Gold a couple years ago.
On a call today, De Grey boss Glenn Jardine said Gold Road had been wall-crossed but that its intentions were not yet known.
The raising will include a 1 for 7.95 pro rate non-renounceable entitlement offer to raise $256.1m including a $174.2m institutional component and $82m retail component, as well as an institutional placement to raise around $343.9m.
Canaccord and Argonaut are on the raising, which is priced at $1.10 a share — a 13% discount to $2.3bn De Grey’s last trading price of $1.265.

POXy questions

The entitlement offer will give De Grey a more than $900m cash runway ahead of its FiD on the Hemi gold mine near Port Hedland.
Part of the 12.6Moz Mallina gold project, the project carries a DFS level capex estimate of almost $1.3 billion, with a 1.8 year cashback period.
The equity component is a major condition ahead of debt financing, with De Grey CFO Peter Canterbury saying ten banks and two government agencies had given indications of intentions to provide between $900-1.2b in debt funding, with De Grey targeting a $1b facility with a cost overrun facility of $100m.
Based off a reserve of 6Moz at a grade of 1.5g/t, much of Hemi is refractory in nature, meaning it will require more complex processing techniques than a conventional gravity and cyanide leach process to liberate its gold.
De Grey’s chosen method is pressure oxidation, a pathway operated at around 20 sites worldwide.
For the investment community, many of the questions around Hemi come down to the expected performance of the POX circuit.
“We’re very comfortable with pressure oxidation. Almost 40% of the world’s gold production comes from refractory ore bodies,” Jardine said.
“There are 20 pressure oxidation plants around the world, including three or four in the Asia-Pacific region.
“We don’t see any particular concerns with commissioning that plant.”
Jardine noted project director Peter Holmes was in charge of commissioning Barrick Gold’s Pueblo Viejo project in the Dominican Republic, regarded as one of the largest POX plants in the world.
Located near Port Hedland, down the road from major lithium discoveries like Pilgangoora, Wodgina and Andover, Jardine said De Grey wouldn’t be pressured into selling its own lithium prospects to help fund Hemi unless the right deal came along.
“We looked at the potential of the lithium on our ground, but not necessarily for funding for project development,” he said.
“There’s a couple of reasons for that. One is as you may be aware, the lithium market is somewhat up and down lately. So getting a line through the value of that asset in the last six months has probably been a little bit problematic for ourselves and others.
“And of course we didn’t really want that asset to have the tail wagging the dog on Hemi. We’ve got a great project at Hemi we’ve got a game plan there in place. Potentially the work around that given the variation in lithium prices and values could have represented a distraction from the main game, which is getting him into production.
“Having said that, we continue to assess options regarding the lithium and we’re looking at options that would present a material difference for the company in terms of feed through value.”
Hemi is coming towards the construction phase with gold prices near all time highs at spot prices of $3525/oz, well above the $2700/oz price used in last year’s DFS.

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Glossary
Wall crossing

A term used to describe the giving of information that could potentially be inside information to a person (the recipient) by a company, often through a representative such as a broker, with the result that, in accordance with insider trading laws, the recipient may be restricted from trading a company's securities. Giving the recipient this information is often referred to as bringing the recipient "over the wall".
Wall crossing may occur in the context of:

An equity raising by a listed public company. Before conducting any equity raising the company may wish to conduct soundings and marketing activity, such as investor roadshows, with potential investors. This process may involve giving the investors information that could be considered inside information in relation to the company, thereby restricting the investors' ability to trade in the company's securities.

A proposed takeover bid. A bidder may approach potential target shareholders for the purposes of building a pre-bid stake and, in doing so, may give those target shareholders information that could be considered inside information, thereby restricting the target shareholder from trading in the target's securities. For more information, see Practice note, Pre-bid stakes and engagement with target shareholders: Insider trading or wall crossing.

A company that proposes to bring recipients over the wall should carefully manage the information-giving process, including by preparing what is often referred to as a wall-crossing script. The script can be used in conversations with potential recipients before bringing them over the wall and is designed to ensure, among other things, that the proposed recipient knows that:

They will be receiving confidential and potentially price sensitive information.

The information is being provided on the basis that it is kept strictly confidential and not shared with any other person without consent.

Once they have this information, for so long as the information remains confidential, they are likely to be restricted from trading or dealing in certain shares, from disclosing the information to anyone else or from using the information to procure someone else to trade or deal in those shares.