Mineral explorer Jupiter Mines has formed a strategic alliance with China's Haoning Group for the development of its iron ore assets in Western Australia through a $3.7 million share placement.
The Sydney-headquartered company has reached an agreement with LSG Resources Pty Ltd, an Australian company that is part of the Haoning Group, for a placement of 14.8 million shares to LSG at 25 cents each.
The parties have also agreed to a non-exclusive off take agreement and will appoint an LSG representative to Jupiter's board following completion of the placement.
LSG will be Jupiter's largest shareholder with a 9.55 per cent stake.
Haoning Group is an iron ore importer and exporter and is also involved in mining, shipping, real estate, ceramics and tourism.
"The Haoning Group's strategy is to expand and vertically integrate its operations globally by acquiring and developing resources, establishing partnerships and developing logistics chains," Jupiter said in a statement.
Chairman Paul Murray said the company would use the funds raised to accelerate the development of its Central Yilgarn iron ore project and for its nickel exploration programs in WA's Widgiemooltha region.
"The proceeds of the placement will increase Jupiter's cash resources to in excess of $8 million, securing the company's projected financial requirements," the company said.
Shares in Jupiter Mines closed one cent, or 4.08 per cent, lower at 23.5 cents.
