Up more than 40x over a year this ASX gold stock just hit a new high on big funding news

Shares in Altair Minerals Ltd (ASX: ALR) have hit a fresh 12-month high after the gold explorer announced that Endeavour Mining Plc would invest $28.2 million into the company at a premium to its last closing price.

Shares racing higher

Altair shares closed at 4.2 cents on Friday, however Endeavour agreed to invest into the company at 4.3 cents per share.

Altair shares immediately raced past that mark on Monday morning, hitting a fresh 12-month high of 5.4 cents before settling back to be changing hands for 4.8 cents.

The low point for the stock over the past year was just 0.1 cents meaning that some lucky shareholders would be sitting on better than 40 times gains at the moment.

Altair said in a statement to the ASX it now had about $40 million in cash, “setting the transformational foundation for exploration success through aggressive drill-testing across Greater Oko over the coming years – with immediate focus on scaling drilling activities and deploying regional exploration teams on untapped greenstone terrain”.

The new funds would be used to carry out 50,000m worth of drilling, split between diamond and rotary air blast drilling.

The money would also allow drilling to be speeded up, with a second rotary drill rig employed.

Multiple potential discovery sites would also be advanced simultaneously, the company said.

Strategic relationship

Altair said Endeavour was a valuable partner to have on board, as it was, “the largest gold producer in West Africa and ranks in the top 10 senior gold producers worldwide”.

The company added:

Endeavour applies a bespoke methodology to exploration – leading to 22.4 million ounces of gold (Measured & Indicated) in discoveries since 2016, and is strategically aligned with Altair’s large scale exploration plans and long-term vision at Greater Oko.

The companies will also set up a joint technical committee to bolster technical know-how across their teams.

Altair Minerals Chief Executive Officer Faheen Ahmed said regarding the deal:

We are excited to add Endeavour as a substantial strategic investor into Altair and to accelerate our Greater Oko exploration programme, leveraging the technical support from one of the most successful gold exploration teams globally. Endeavour is the largest gold producer in West Africa, renowned for its exploration track record and technical expertise across the West African Birimian Greenstone Belt. The greenstone belts on the Guiana Shield represent a geological continuity of the Birimian Greenstone Belt, which presents a unique synergy between both companies, allowing Altair to leverage the technical acumen at Endeavour in order to fast track exploration success at Greater Oko.

Mr Ahmed Greater Oko presented a unique opportunity in Guyana where permits are largely fragmented, offering the largest consolidated gold exploration project in the country.

Endeavour will be a 9.9% shareholder in Altair following the placement.

Altair was valued at $244.9 million at the close of trade on Friday.

The post Up more than 40x over a year this ASX gold stock just hit a new high on big funding news appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position 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 Scott Phillips.