Avocet buys into Dynasty

London-based Avocet Mining (AVVGF-O, AVM-L) has bought a 21% holding in Dynasty Gold (DYG-V, DGDCF-O) via private deals and participation in a recent Dynasty financing.

Avocet will subscribe for 2.75 million units in Dynasty’s 8.6-million-unit private placement. The units, priced at 18, have an attached warrant exercisable at 30 for a year; the placement raises $1.55 million. Avocet is also buying shares and rights from two individual and two corporate shareholders of Dynasty.

The matchmaker in the deal was London-listed explorer Caledon Resources (CDN-L) which raised its own holding in Dynasty to 13% by way of the private placement. Caledon said in a release that it expected long-term benefits to Dynasty in developing the Hatu gold deposit in Xinjiang (East Turkestan) province through Avocet’s experience in mine production in Central Asia.

Dynasty is earning an 80% interest in Hatu, where the main Qi-2 deposit has an inferred resource of 16.9 million tonnes grading 1.7 grams gold per tonne. The funding from the placement is to be used for infill drilling to bring the resource into the measured and indicated category.

Avocet reported net income of US$3.4 million on revenues of US$42.7 million in the 6-month period ended Sept. 30. That compared with half-year earnings in Sept. 2004 of US$4.6 million, on revenue of US$32.6 million. The company has recently bought a mining fleet for its North Lanut heap-leach gold mine in Indonesia, and done substantial waste stripping at its Zeravshan open-pit gold mine in Tajikistan.