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Reed Resources Well Supported By The Market, Welcomes New Substantial Investor

Reed Resources (ASX: RDR) has received a vote of confidence from Northcape Capital, which has taken up a 5.2% holding in Reed.

Privately owned investment firm Northcape specialises in Australian and global listed equities, managing funds on behalf of institutional clients and high net worth individuals.

At June 30, 2011, Northscape had about $6.5 million worth of funds under management.

Northscape holds 22.9 million shares in Reed Resources.

Reed is well supported by the market, with the company's decision to mine at its Meekatharra Gold Project earlier this year attracting attention, not just from investors but also from financiers.

Earlier this month the company welcomed boutique investment manager SG Hiscock & Company as a substantial shareholder, with total holdings of 5.09% and voting power of 4.07%, while existing substantial shareholders M&G Investment Management and Vanguard Precious Metals both increased their stakes.

Leading UK investment manager M&G Investment Management acquired 43 million shares, taking its shareholding in Reed to 15.2%.

Meanwhile, U.S. based Vanguard Precious Metals and Mining Fund took up 25 million shares, increasing its stake to 10.58%.

This follows a recent deal struck with Barclays Bank for A$23 million in funding for Meekatharra.

Indicating the strength of the project, the company appointed Barclays after an extensive tender process in which competitive proposals were received from a number of domestic and international banks.

The Meekatharra Project hosts a Resource of 3.59 million gold ounces and a Reserve of 750,000 ounces, a milestone not matched by many gold companies in Western Australia.

Reed is targeting a Reserve upgrade in the June quarter of 2012.

The first gold pour at Meekatharra is expected in the December quarter this year, with stage one of production targeting 95,000 ounces of gold annually.

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