Delta Lithium (ASX:DLI) said it is demerging its Mt Ida Gold asset into a new, standalone, gold-focused Australia-listed exploration company called Ballard Mining as it intends to separate its gold and lithium assets, according to a Thursday Australian bourse filing.

As part of the concurrent initial public offering, Ballard intends to raise between AU$25 million and AU$30 million, before costs, while eligible Delta shareholders will also be entitled to participate in a priority offer.

Former De Grey Chairman Simon Lill will be appointed as non-executive chairman of the new company, and Tim Manners will be its finance director.

The company said eligible Delta shareholders are expected to receive one Ballard Share for every 11.25 fully paid ordinary shares in Delta through an in-specie distribution.

The company will retain a substantial stake in Ballard to keep an "upside" exposure, the filing added.

The company's shares rose nearly 3% in recent Thursday trade.