Ascot increases financing target to $42 million, shares up 12%
Ascot Resources Ltd. [AOT-TSXV, AOTVF-OTCQX] and a syndicate of agents have agreed to increase the size of a previously announced private placement offering of common shares from gross proceeds of at least $25 million and up to a maximum of $35 million, to gross proceeds of $42 million.
Ascot shares rallied on the news, rising 11.9% or $0.025 to 23.5 cents. The shares trade in a 52-week range of 91 cents and 14 cents.
In a press release on October 21,2024, Ascot said it was planning to raise approximately $40 million in funding to advance the development of the Premier Northern Lights (PNL) mine, restart the mill and restart the Big Missouri mine from the current state of care and maintenance. Those assets are located in the Golden Triangle area of British Columbia, near the company’s Premier Gold Mine which poured its first gold in April, 2024.
The company said it has been in discussions with its main creditors, Sprott Private Streaming and Royalty (B) Corp., Nebari Gold Fund 1 LP, Nebari Natural Resources Credit Fund 11, LP and Nebari Collateral Agent LLC who have entered into a non-binding indicative term sheet with the company to provide up to US$11.25 million in new senior debt.
The company had previously entered into an agreement with a syndicate of agents in connection with a private placement financing priced at 16 cents per common share to raise a minimum of $25 million and a maximum of $35 million.
“This financing package will enable the company to undertake the mine development activities necessary to advance the PNL and BM in order to sustainably provide feed to the mill,’’ said Ascot CEO Derek White. “While the timeframe and funding required to undertake this work has been challenging for the company, recent actions were required to ensure sustainable feed for profitable mill operations,’’ he said. “Ascot is focused on getting the operation back on track as we move to restarting gold production in the second quarter of 2025.’’
Ascot was in the news recently when it raised $34 million from a bought deal financing with part of the proceeds earmarked for ongoing commissioning and ramp-up of the company’s Premier gold project. The final amount raised is up from an earlier $20 million target.
Proceeds raised from the financing included the full exercise of the over-allotment option. The offering consisted of 30.2 million flow-through units priced at $0.496 per unit, and 44.18 million hard dollar units priced at 43 cents per unit.
Each offered security consists of one common share and one common share purchase warrant, each of which entitles the holder to acquire one share for 52 cents per warrant share for 24 months following the close.