The White Rock Minerals Ltd (ASX: WRM) share price was drowning in a sea of red today, reaching a 52-week low after the company announced an $11 million capital raise.
At market close, the White Rock Minerals share price was down 22.58%, trading at 24 cents.
White Rock Minerals is a mineral explorer going for gold at the Woods Point Gold Project in Victoria.
What is White Rock Minerals up to?
In its release today, the company advised it planned to raise $11.3 million before costs via a $2.25 million share placement and $9.1 million entitlement offer.
Capital raises can be a catalyst for a share price plunge (akin to today's performance) due to share dilution. Indeed, the company said in its release the share offer represented a 23% discount on the trading price before the capital raise of 31 cents.
White Rock said eligible shareholders would also be offered a 1 for 4 pro-rata non-renounceable entitlement offer.
The money will be used for gold exploration at the Woods Point Gold Project. The company acquired this project via a merger with AuStar Gold in August 2021.
The exploration area of 660km is located in one of Victoria's largest historic goldfields, 120km east of Melbourne.
Management commentary
White Rock managing director and CEO Matt Gill said:
This capital raise will see White Rock continue this aggressive exploration focus on the significant in-mine and regional exploration potential of the project.
The board is very appreciative of the support shown from current shareholders and the interest and support being shown from the new investors now joining the White Rock journey through this equity raising.
White Rock Minerals share price snapshot
White Rock Minerals share price has fallen 56.36% over the past 12 months and 59% in the year to date. The share price is currently trading at a 52-week low of 24 cents.
The company has a market capitalisation of about $34 million.
