Xanadu Mines (ASX: XAM) is heading to market with a capital raising, with the ASX granting the company a trading halt this morning.
XAM's shares are now in pre-open.
The company and its joint venture company Mongol Metals have agreed to acquire a 90% interest in the Kharmagtai advanced porphyry copper-gold exploration project in Mongolia for US$14 million from Turquoise Hill Resources.
Previous exploration had identified significant shallow high-grade porphyry copper-gold mineralisation, including 245 metres at 0.75% copper and 2.48g/t gold from 3 metres.
The halt will last until the opening of trade on Monday 7th April, or earlier if an announcement is made to the market.
Mongol Metals will pay initial consideration of US$4 million with deferred consideration of US$10 million to be paid over 18 months.
Xanadu has committed to spending around US$900,000 up to completion (about US$700,000 to date including US$250,000 of an initial US$500,000 deposit) to earn a circa 18% interest in Mongol Metals.
The company has the right to earn at least 85% of the Mongol Metals joint venture company through funding exploration and acquisition costs.