Shares in industrial minerals company Andromeda Metals Ltd (ASX: ADN) are surging 18% higher today and now trade at 22.5 cents apiece.
Whilst there’s nothing price-sensitive out of Andromeda’s camp today, its share price has crept up gradually after bouncing off a 15 cent low in December.
Why’s the Andromeda share price soaring today?
In the absence of any market-moving information or news, it’s not abundantly clear on exactly what is behind the monstrous jump in the Andromeda share price today.
However, investors have been piling into the company these past few weeks, such that shares have exploded more than 32% in the last month.
That’s a huge step ahead of the S&P/ASX 200 Index (ASX: XJO)’s return of less than 1% over the past month.
Underpinning the growth is a pair of market updates released in the back end of 2021. Firstly, the company announced its pending merger with Minotaur Exploration Ltd (ASX: MEP) last year. If the merger is given the green light, Andromeda would then be the 100% owner of the Great White kaolin project.
The proposal of 1.15 new Andromeda shares for each Minotaur share will close on 31 January after Minotaur directors unanimously recommended its shareholders to accept the offer.
Aside from this, South Australian Energy and Mining Minister Dan van Holst Pellekaan, granted mining leases for the Great White kaolin project last month as well.
The decision marks another step closer to becoming a “world-class” producer of kaolin minerals, according to managing director James Marsh at the time.
“Once in production a whole range of new and significant halloysite-kaolin opportunities will open up for us, and I would like to thank the whole Andromeda team for their dedication and professionalism”, Marsh said.
Andromeda share price snapshot
Despite the recent strengths, the Andromeda share price has fallen more than 23% in the last 12 months.
Yet, it has climbed over 32% in the past month and is now up almost 22% for the year to date.
So far, this year to date, Andromeda is outpacing the broad index’s loss of less than 1%.
The post Why is the Andromeda Metals (ASX:ADN) share price leaping another 18% today? appeared first on The Motley Fool Australia.
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The author has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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