- WA-based gold and nickel explorer Cavalier Resources (CVR) officially joins the ranks of the ASX following its successful $5 million initial public offering
- The company commences trading with an $8.6 million market cap and plans to use its IPO funds to advance towards potential mining activity in WA’s Leonora region
- Through its unique strategy, Cavalier aims to use potential near-term cashflows from its Crawford project to fund further exploration and development work across its portfolio
- The company plans to be a tightly-held entity exposing investors to the growth potential of an explorer without the dilution typically associated with mine development
- Cavalier’s combination of near-term and blue-sky opportunities alongside the potential to self-fund work for years to come sets it apart from other recently-listed businesses
WA-based gold and nickel explorer Cavalier Resources (CVR) has officially joined the ranks of the ASX following its successful $5 million initial public offering.
The company has commenced trading with an $8.6 million market cap and plans to use its IPO funds to advance towards potential mining activity in WA’s Leonora region within a projected 18 months after listing.
This will come even as Cavalier explores multiple untested nickel and gold targets at its projects in Forrestania and north of Kalgoorlie.
Through its unique strategy, Cavalier aims to use potential near-term positive cashflows from its 101,000-ounce Crawford project to fund further exploration and development work across its project portfolio — meaning investors are exposed to all the growth potential of an exploration company without the dilution typically associated with mine development.
Executive Technical Director Daniel Tuffin said thanks to the successful IPO, the company was now in a position to “rapidly” progress its WA gold and nickel-gold projects.
“The company has budgeted for an extensive exploration program over the coming two years,” Mr Tuffin said.
“It will conduct an internal review to advance mine readiness and expects to commence drilling at Crawford soon.”
He said Cavalier also planned to begin exploration work at its Gambier Lass North and Ella’s Rock projects even as it progressed its Crawford development.
What does Cavalier offer investors?
Each year, the ASX is flooded with new exploration companies promising prospective ground and savvy development strategies.
So, what makes Cavalier’s IPO different to other companies of a similar nature?
Firstly, the company’s tenement packages lie next door to several operating mills.
The Leonora Gold project package, which comprises the Crawford and Gambier Lass North sub-projects, is strategically located within a 50-kilometre radius of three operating gold mills, all seeking new sources of mill feed.
This means the company can look to leverage these surrounding mills to expedite its first cashflows from Crawford as it works to self-fund its exploration work at other projects.
Secondly, the ability to self-fund within a projected 18 months after listing means Cavalier will be a tightly-held, non-dilutive entity.
“From a shareholder’s point of view, there will be few shares on offer, the company will be very tightly held, and we look to really create some value in the ground by initially focussing our efforts at Crawford and by converting resources to reserves and utilising those reserves to potentially self-fund Cavalier into the future,” Mr Tuffin said.
He added that while there was significant blue-sky exploration potential across its Hidden Jewel and Ella’s Rock assets, the company also had the potential to expand and extend its Crawford reserves, meaning it could repeat its self-funding cycle several times.
This means if all goes according to plan, there may be little to no dilution for shareholders for many years to come.
This combination of near-term and blue-sky opportunities next to already-developed infrastructure, alongside the ability to self-fund work for years to come, sets Cavalier apart from other recently-listed companies on the ASX.
Who’s driving Cavalier’s growth?
Cavalier is led by a team of experienced executives with years of experience in the mining industry behind them.
Mr Tuffin, for example, has been a mining engineer for 25 years, having worked extensively across the Asia Pacific. He has developed several projects, including a private gold mining venture, while successfully taking several other projects to an IPO.
He is currently the Managing Director and CEO of recent float Panther Metals (PNT) and is on the board of Mt Malcolm Mining (M2M).
The Cavalier board and team have been purpose-built to carry out specific roles across the entire range of company activities — from exploration through to mine development.
Executive Chairman Ranko Matic is at the helm of Cavalier and currently also serves as a director of Lycaon Resources (LYN), Panther Metals and Australian Gold and Copper (AGC).
As evidenced by their shared board roles, the majority of the same team that brought Panther Metals to the ASX has driven the successful Cavalier IPO, demonstrating once again their experience across the public mining industry.
This means investors can take comfort not only in the fact the Cavalier has a shrewd development strategy across some of WA’s most prolific mining jurisdictions but also in the fact that the company is led by a management team who has done this all before.
The Cavalier team knows the challenges associated with listing on the ASX and developing exploration projects, and, more importantly, it knows how to minimise risk and maximise shareholder gain.