Increased Lion Participation in Brightstar Placement

Lion Selection Group Limited (Lion, the Company) is pleased to announce it has been able to increase its participation in the $24M equity fundraising announced by Brightstar Resources Limited (Brightstar, ASX:BTR) on 2 August 2024¹. Lion announced its commitment to invest $4.3M in this fundraising on 2 August 2024² and has recently provided an increased commitment for a further $1.5M, taking Lion’s total investment via the deal to $5.8M.

• Lion to invest a further $1.5M in Brightstar in tranche two of the placement announced on 2 August 2024.
  
• This will take Lion’s total participation in the placement to $5.8M.
• Assuming the completion of all the transactions announced on 2 August, Lion to become 6.1% shareholder in the enlarged Brightstar.

Lion’s increased participation is to be settled in tranche two of the placement, expected to take place in mid-September following a general meeting of Brightstar shareholders.

Lion Chief Executive Officer Hedley Widdup said: “Brightstar is already one of our largest investments; Lion strongly grew its holding via the placement announced in August and is pleased to add to this position. The market is valuing gold producers at a large premium versus gold explorers and developers. Brightstar is a company that, in our eyes, has a genuine proposition to bridge that gap; to become a gold producer without taking on excessive finance or hedging, with a strong organic growth pipeline.”

Brightstar Resources – short pathway to production, and strategy to apply cash flow to fund growth

Brightstar has established gold resources at Laverton and Menzies, which are the subject of a feasibility study at present and feature a combined Mineral Resource of 1.46Moz of gold grading 1.6g/t³. A scoping study released in September 2023⁴ contemplated gold production commencing via processing of Brightstar ores at regional process facilities, and the resultant cash flow enabling the rejuvenation of Brightstar’s own process plant near Laverton.

Consolidation and acquisition of Sandstone project

Consolidation and acquisition of ground containing established gold Resources via the Alto and Gateway projects at Sandstone introduces an additional established Resource position of 1.5Moz grading 1.5g/t⁵. Brightstar intends to undertake an aggressive drilling effort at Sandstone where there is scope to materially increase the resource estimate with focussed exploration.

Result – large gold inventory with a strong growth pathway

The resultant Brightstar will have a pro-forma combined gold resource of 3.0Moz⁵, between three key projects at Menzies, Laverton and Sandstone. The announced capital raising¹ positions Brightstar to be strongly funded, and the strategy to commence production via ore sales or toll treatment is expected to generate cash flows that can support growth. The combination of this strategy and newly consolidated large mineral resource inventory presents the potential to go on to become a large gold producer.

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