Alecto's shares dive after dicounted £650,000 placing

Alecto Minerals's shares plunged almost 17% after raising £0.65m in a discounted placing as it moves to bring the 400,000 tonnes-a-year Matala Gold Project, Zambia, into low-cost production in the near- to mid-term.

The placing of 831.25m shares priced at 0.08p each, which would account for about 18.64% of Alecto's enlarged share capital, was fully subscribed. Alecto's shares were up almost 17% this afternoon.

CEO Mark Jones said directors were extremely mindful of dilution, and that it was unfortunate there had not been greater traction in the company’s share price, allowing it to raise funds at a premium to its last fundraise in November 2015.

This was despite strong news flow after its acquisition of open-pit Matala, and including the announcement of joint ventures with Randgold Resources and Cora Gold, Jones said.

"The board is acutely aware of the importance of maintaining momentum on the ground in Zambia, to build on the excellent start we have already made. There is potentially still huge upside for stakeholders if we get this right,” he said in a statement.

"With this in mind, we will continue to focus and deliver on our strategy, which I believe will translate into share price appreciation moving forward."