ASX IPOs: How will MB Gold stack up against recent gold listings?
Global Lithium spinout MB Gold seeks $6 million to drill three early-stage Pilbara gold prospects.
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KEY POINTS
- MB Gold is raising $6 million for an indicative $8.6 million market cap for three early-stage Pilbara gold prospects with limited drilling history
- The company is a spin out of Global Lithium's gold assets, though Global Lithium will retain 8,000,100 shares post listing
- Gold has rallied 20.6% since the prospectus was lodged in November 2024, providing a supportive market backdrop
The IPO market is heating up, and I'm on a mission to take a closer look at all upcoming listings, providing key data and insights ahead of their ASX debut.
MB Gold (ASX: MBG) is a spinout of Global Lithium's gold assets, covering 515km<sup>2</sup> of prospective terrain within the Archean Pilbara Craton in WA.
The tenement, known as the Marble Gold Project, comprises three gold prospects: Razorback, Twin Veins and Douglas Find. All three are relatively early stage, with limited historical drilling and some recent exploration activity. Notable historic intercepts include:
Razorback: 7m @ 3.78 g/t Au from surface, 8m @ 1.57 g/t Au from 50m
Twin Veins: 12m @ 2.95 g/t Au from 37m, 12m @ 2.95 g/t Au from 37m
Douglas Find: 4m @ 1.16 g/t Au from 36m, 2m @ 1.31g/t Au from 50m
The IPO is seeking to raise $6 million for an indicative market cap of $8.6 million. Global Lithium will receive 8,000,100 shares, representing 13-18% of the company (depending on the amount raised)
MB Gold is set to list on Friday, 6 February.
The criteria
Below, we'll assess whether MB Gold checks off the common ingredients for a successful market debut. You can read my piece about it here.
Underwritten: No, though IPOs of this size are almost never underwritten.
Options: The prospectus includes secondary offers of 3 million director options and 750,000 lead manager options. These are exercisable at 30 cents (a 50% premium to the offer price), incentivising directors and managers to support the IPO, marketing efforts and post-listing performance.
Track record: Ventnor Securities is the lead manager. While active in equity capital markets, the firm hasn't led any recent IPOs.
Near-term catalysts: MB Gold plans RC and diamond drilling at all three prospects following initial earthworks, soil surveys, rock chip sampling and target generation.
Substantial shareholders: Global Lithium is the only substantial shareholder listed (8,000,100 shares). Additional cornerstone investors in the form of management, an exploration partner or a boutique fund would strengthen the register.
Time and place: Despite recent volatility, gold is trading around US$5,000/oz. Since the prospectus was lodged on 26 November 2024, gold has rallied roughly 20.6%.
The bottom line
Not the most exciting IPO, especially compared to some recent gold listings like:
Sentinel Metals (SMN), a gold and silver explorer seeking to develop its Columbia Project in Montana, United States. The Columbia Project already contains an inferred Mineral Resource Estimate of 960koz gold equivalent at 1.4g/t AuEq, plus a large independent exploration target of 800-1,200koz gold.
Green & Gold Minerals (GG1) operates two early-stage projects in Queensland: the Chillagoe Gold Project and Cosgrove Rare Earths Project. Chillagoe also contains a small inferred mineral resource estimate of 32koz gold and 387koz silver.
MB Gold's post-listing performance may depend on management's ability to deliver a steady flow of exploration catalysts and whether early drilling can upgrade the historical intercepts into something more substantial.
