GBM Resources has raised A$39.85m ($26.14m) through an institutional placement to expedite exploration and development in its Drummond Basin gold portfolio in Queensland.

This fundraising effort saw substantial support from both new and existing institutional investors including its largest shareholder, Wise Walkers, which committed A$8.05m, pending shareholder approval.

The placement involves issuing approximately 752 million new shares at A$0.053 each, reflecting a 3.6% discount to GBM’s last closing price and a 4.7% discount to its ten-day volume-weighted average price.

Canaccord Genuity (Australia) served as the lead manager and bookrunner, while Argonaut Securities co-led the placement.

Proceeds from the placement, along with existing cash reserves, will be used to enhance exploration and development activities at GBM’s 100%-owned Drummond Basin assets, which host mineral resources of around 1.84 million ounces (moz).

The proceeds also be used to support business development initiatives and for general working capital.

The capital raising will occur in two tranches. The first tranche involves 600 million shares issued under existing placement capacity, and the second consists of 151.9 million shares to Wise Walkers, which requires shareholder approval.

GBM CEO Daniel Hastings said: "We are delighted with the extremely positive and overwhelming response received by the company for the placement and wish to thank all shareholders, including Wise Walkers, for their continued show of support in the company."

Hastings further noted; "The strengthening of the balance sheet provides a robust platform to not only grow the existing resource base at the key Twin Hills and Yandan deposits (combined mineral resources of about 1.5moz) but importantly to undertake systematic exploration and test new regional targets, allowing the company to fully unlock and maximise the potential across the company’s entire Drummond Basin portfolio."