SINGAPORE (Nov 30): Golden Energy and Resources (GEAR) is making a foray into Australia’s gold mining sector.

The coal mining and trading company has entered into a subscription agreement with Westgold Resources to subscribe for up to 36 million new shares in Westgold at A$1.885 each for a total of A$67.86 million ($69.3 million).

Westgold is an Australian-incorporated gold miner that is listed on the Australian Stock Exchange (ASX). Westgold is principally engaged in gold mining in Australia and holds mining tenure positions and numerous gold production assets in two provinces in Western Australia, namely the Eastern Goldfields (Kalgoorlie region) and the Murchison Goldfields (Cue-Meekatharra regions).

The subscription shares represent 10% of the enlarged share capital of Westgold.

GEAR will also have the right to nominate a person to be appointed as a director of Westgold.

The proposed subscription will be fully funded by GEAR’s existing loan facility and internal resources.

GEAR says its stake in Westgold will enable it to gain access to the gold mining sector in Australia and provide opportunities to leverage on future potential collaborations and partnerships with Westgold, one of Australia’s most prominent gold mining companies.

Fuganto Widjaja, executive director and group CEO of GEAR, says, “GEAR’s interest in Westgold is a strategic move to widen our group’s coal-focused mining business to include counter-cyclical commodities that can potentially bring additional value to our shareholders.”

Shares in GEAR closed at 40 cents on Thursday.