Silver sings as major fund nabs 10% stake in Mithril at hefty premium

Mithril Resources has landed Jupiter Gold and Silver Fund as a cornerstone investor as part of $3.7m placement at a 29% premium.

Mithril Resources has raised $3.7m through a placement that has also seen Jupiter Gold and Silver Fund take up a 10% cornerstone investment. Pic: Getty Images

• Mithril Resources receives firm commitments for a $3.7m placement at a 29% premium

• Placement includes $2m, 10% cornerstone investment from Jupiter Gold and Silver Fund

• Proceeds will more than double the current drill program from 4000m to 9000m

Special Report: The value of Mithril Resources’ Copalquin gold-silver project in Mexico has been highlighted by a cornerstone investment from Jupiter Gold and Silver Fund as part of a $3.7m capital raising at a 29% premium.

The high-grade Copalquin silver-gold project and its resource of ~530,000oz of gold equivalent (AuEq) within the Refugio/Soledad target area covers 70km2 and is host to over 70 historical gold-silver mines and workings.

It is also the only asset of its kind held by an ASX-listed company in Mexico, the world’s top silver producer accounting for a quarter of global production.

While the current resource is contained within Refugio/Soledad target area, work by Mithril Resources (ASX:MTH) has already outlined plenty of potential for expansion.

At the end of May, the company restarted drilling with a 4000m program. This is the first phase of drilling throughout 2024 with the aim of doubling the current resource by Q1 2025, within the first target area at Refugio/Soledad.

It follows-up on previous high-grade intersections such as 8.26m at 80.3 g/t gold, 705 g/t silver and 3m at 34.7 g/t gold and 3129 g/t silver.

Drilling will also test new structures and zones along with areas near the historical El Refugio and La Soledad mine workings.

Placement at a premium

MTH has now received firm commitments for the placement to raise $3.7m at 20c per share – a 29% premium to the last traded price of 15.5c and 4% to the 15-day volume weighted average price.

Central to this placement is a cornerstone investment of $2m from Jupiter – a London-based specialist gold and silver asset manager with ~$1bn in assets under management.

Jupiter is no stranger to ASX-listed companies, having been a shareholder of De Grey Mining (ASX:DEG) since 2020. Suggesting the high esteem with which it holds Mithril’s potential, Jupiter is selective about its investments with just 3% of its assets under management being stakes in exploration companies.

Directors of the company have also committed to subscribe for $100,000 worth of shares under the same terms while the other shares will be picked up by new and existing institutional, professional and sophisticated clients of PAC Partners Securities and Arlington Group Asset Management.

Proceeds from the placement will be used to extend and accelerate drilling at the Copalquin project.

MTH will more than double the size of the drill program to 9000m, allowing drilling to be continuous throughout the second half of 2024.

It added that the first hole in the program has completed reaching a depth of over 650m to test below the previously drilled CDH-077, which had returned the 8.26m at 80.3 g/t gold and 705g/t silver from 468.3m intersection.

“We are very happy to welcome Jupiter Gold and Silver Fund to the register,” managing director John Skeet said.

“In October 2023, we hosted Jupiter on a site visit at our Copalquin project in Mexico and they obviously liked what they saw given this A$2 million or ~10% investment in Mithril.

“The additional funding allows Mithril to continue drilling at Copalquin throughout the remainder of 2024, placing us on track to update the high-grade resource at the Target 1 area in Q1 2025, aiming for 2x current Target 1 resource, and to test adjacent targets.”

Other activity

MTH adds that its application to dual list on the Toronto Venture Exchange is in process subject to approval.

The placement coming at a premium highlights the enthusiasm of new investors for the stock’s prospects and their confidence in the thematic for gold and silver.

Up ~23% YTD, the long overlooked precious metal silver is one of the top performing commodities in 2024 as demand from renewables and safe haven investing propel interest in gold’s cousin higher.

This article was developed in collaboration with Mithril Resources, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.