PERTH (miningweekly.com) – ASX-listed Australian Mines has reported that its spin-out subsidiary has already secured A$5-million in funding commitments to progress its initial public offering (IPO).

Australian Mines is planning to transfer its Western Australian gold and base metals exploration assets into subsidiary Norwest Gold, which will seek to complete an IPO to raise A$6.6-million by the end of October this year.

Australian Mines said on Thursday that A$1-million in seed funding has been secured to facilitate the advancement of the IPO process, with cornerstone investors committing a further A$4-million in the IPO.

“I am confident the decision to establish Norwest as a separate, independently managed and focused public company is the best path forward for achieving true market value for our highly prospective gold and base metal exploration projects in Western Australia, and I am pleased to be providing priority exposure to this investment opportunity for our existing shareholders,” said Australian Mines MD Benjamin Bell.

Bell said that the investment agreements already secured reinforced the market interest in the portfolio of Western Australian gold and base metals exploration assets.

The assets include the Marymia, Arunta West and Marriotts, as well as the Warrriedar and Bali assets.

“Australian Mines’ shareholders will continue to benefit from exploration success of Norwest through the significant equity stake that the parent company will continue to hold in the new entity, and I look forward to seeing the future results from more focused exploration across the Norwest asset portfolio.”

Australian Mines is expected to hold a 28.6% share in Norwest, while investor Merit Grace Global will hold an 8% interest and YF Chee Holdings a 23.9% interest. CNG Global will also hold a 18.9% interest in the company.