Ausgold (ASX:AUC) has received binding commitments to raise AU$35 million at AU$0.57 per share, supported by several offshore and domestic institutional investors, including both new and existing shareholders, according to a Thursday Australian bourse filing.

The company's directors will subscribe for AU$150,000, for which the company will issue 263,159 shares, in addition to the placement, subject to shareholder approval at a general meeting to be held in mid-August.

The proceeds will be used to accelerate the Katanning gold project towards a final investment decision, including enabling the purchase of long lead-time items and providing a strong budget for ongoing exploration and the acquisition of freehold land.

The company said it will issue a total of 61.4 million new shares in a single tranche to raise $35 million, for which settlement is expected to occur on or around July 17, with trading on the ASX on a normal settlement basis on July 18.

The issue price of AU$0.57 represents a discount of 7.3% discount to the last traded price on July 7 of $0.615.

Dundee Corporation subscribed AU$2 million in the institutional placement, acquiring a 10.08% interest in the company. The share issue is subject to approval from the Treasurer under the Foreign Acquisitions and Takeovers Act of 1975, if required.

The company's shares were down 5% in recent Thursday trade.