Shares of Contango Holdings PLC (LON: CGO) today surged 28% after the mining company announced that it had bought the Garalo gold project in Mali for $1 million, which is expected to start producing gold in H2 2021.
The firm also revealed that it had raised £1.8 million via a share placement at 5p a share.
Investors did not seem to mind the share placement given today’s rally following the acquisition of the Mali gold project.
Contango recently completed the reverse takeover of the Lubu coalfield project in Zimbabwe in June this year but is yet to provide updates on how close to production the coking coal mine is.
Today’s acquisition will see the company acquire another asset that is also close to production and we are likely to see its shares soar once either of these projects starts production.
Contango share price
Contango shares today surged 29.2% to trade at 6.46p having risen from Friday’s closing price of 5.0p.