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Southern Gold’s $4 Million Restructured Placement

Southern Gold

Since the Southern Gold Limited (‘Southern Gold’ or ‘the Company’) ASX announcement “$10 Million Institutional Placement” the fallout from the COVID19 pandemic and other economic developments have profoundly impacted the share market and broader business conditions, particularly in the past week. The company has withdrawn the previous placement offer and made a new offer to cornerstone investor AIM-listed Metal Tiger PLC (‘Metal Tiger’) and other institutional and sophisticated investors.


  • Due to changing market and business conditions the Company is withdrawing the placement offer made to institutional investors announced to ASX on 11 February 2020.
  • An alternative offer has been made and commitments received for the subscription of 40,000,000 Southern Gold Ltd ordinary shares at 10c per share, to raise $4 million (before costs).  
  • AIM listed investment specialist, Metal Tiger PLC, has strongly supported the equity raising and has subscribed for 22,000,000 shares for $2.2 million.  
  • Metal Tiger nominee, Terry Grammer, will join the Southern Gold board as part of the transaction as originally outlined in the ASX release dated 11 February 2020.  
  • Post transaction cash balance will be ~$5.5 million and support a minimum of 12 months field campaign, including the diamond drilling of multiple projects, targeting significant news flow in 2020-21.

The Company has now received binding commitments from investors in respect of a placement of 40,000,000 ordinary shares in the Company at $0.10 per share to raise $4m million (‘Placement’). The Placement is at a 16% discount to the 15-day VWAP and will be completed in two tranches. The first tranche of $2.168 million, to be completed immediately, is being done within the Company placement capacity under Listing Rule 7.1/7.1A with the balance of the Metal Tiger investment (approximately $1.7m) and Directors subscriptions ($0.13m) in the second tranche (approximately $1.83m in total) being subject to shareholder approval.

Southern Gold acknowledges the continued support of Metal Tiger with their subscription for 22m shares for $2.2 million which is a significant cornerstone position in the Placement. The terms of the investment are managed under the original subscription agreement and subsequent letter of variation.

Southern Gold Managing Director, Mr Simon Mitchell: “We are in unprecedented markets – perhaps a 1 in 100-year event – and this has clearly had an impact on our ability to execute the original equity raising. However, it is times like these that good supportive major shareholders, a solid new cornerstone investor such as Metal Tiger PLC and the backing of an excellent broker in Ashanti Capital, have all contributed to pulling together $4 million in the most difficult of markets. While we will be prudent with expenditure going forward, the raising enables Southern Gold to continue to maintain momentum in our field programmes and drilling, perhaps the most critical factor in a junior explorer’s ability to survive downturns.”

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