McFarlane Lake secures up to $25m financing for Juby acquisition
CSE-listed McFarlane Lake Mining has arranged as much as $25-million in financing to support its planned purchase of the Juby gold project in Ontario from Aris Mining Holdings.
The Canadian explorer agreed to a $15-million bridge loan with a syndicate of lenders, which could be upsized to $20-million, and plans to raise another $10-million in a private equity offering, the company said on Monday in a statement.
The debt carries a 15% yearly interest rate and comes with 48-million share purchase warrants exercisable at C$0.15 apiece for three years.
The concurrent equity offering will consist of up to 92.7-million common shares and the same number of flow-through shares priced at C$0.15 each. Proceeds will go toward the cash portion of the Juby acquisition, as well as general working capital.
As part of the transaction, McFarlane will also issue shares to Aris Mining, giving it a 19.9% stake. The deal remains subject to Canadian Securities Exchange approval and other customary conditions, and is expected to close in September.
“Execution of this transaction allows McFarlane to take hold of what I believe is one of Ontario’s premier undeveloped gold deposits,” said chairperson and CEO Mark Trevisiol. “It represents the first step in the process of unlocking value at the Juby gold property, in a gold market where almost all producers are experiencing unprecedented cash flows. Our team is excited and determined to advance this property to production.”
Aris Mining CEO Neil Woodyer said previously that the sale of Juby reflected the company’s strategic focus on building a leading gold mining company in Latin America. “Juby is a promising exploration property but is noncore to our operations in Colombia and Guyana. We are pleased to see it move into the hands of a dedicated and experienced management team that is well positioned to unlock its potential.”
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