PERTH (miningweekly.com) – Junior Peel Mining on Monday announced that it would raise A$17.1-million in order to gain full ownership of the Mallee Bull base metals project, in New South Wales.

Peel told shareholders that it would acquire joint venture (JV) partner CBH Resources’ 50% stake in the project by exercising its pre-emptive right and matching a third party’s unconditional cash offer of A$17-million.

“The consolidation of Mallee Bull will deliver a number of very important outcomes for our business plan, those being, control, critical mass and copper.

“Bringing Mallee Bull back into the fold makes us masters of our own destiny once again, however, most importantly, it delivers potential critical mass for our goal of establishing a standalone operation in our region of the Cobar basin, with the added benefit of repositioning the company’s primary metal exposure to copper in a rising copper price market,” said Peel MD Rob Tyson.

“The Mallee Bull JV also includes the May Day gold-polymetallic deposit where we see an exploration opportunity to add shallow gold resources to our asset base, a potential boost towards our critical mass aspirations.”

Mallee Bull contains a Joint Ore Reserves Committee-compliant resource of some 6.76-million tonnes, at 1.8% copper, 31 g/t silver, 0.4 g/t gold, 0.6% lead and 0.6% zinc.

To fund the acquisition, Peel would undertake a A$17.1-million capital raise, consisting of a share placement to institutional and sophisticated investors to raise an initial A$10.5-million, as well as an entitlement offer to raise the balance.

The share placement will consist of 60-million shares at an issue price of 17.5c each, and will be undertaken under the company’s existing placement capacity.

The company will also undertake a fully underwritten one-for-eight pro-rata non-renounceable entitlement offer, also priced at 17.5c each, to raise a further A$6.6-million.

“The support and demand we have received for the capital raising from existing and new institutional, sophisticated and professional investors has been overwhelming, reaffirming and validating our belief in the project and the company’s strategy,” said Tyson.