Osisko Development active on US$50 million financing news
Osisko Development Corp. [ODV-TSXV] said it has struck a deal with certain lead agents who have agreed to sell up to 27.8 million units of the company at a price of US$1.80 per unit, generating gross proceeds of US$50 million.
The company said it intends to use the proceeds for the advancement of its Cariboo and Tintic projects, to partially repay its existing credit facility and for general corporate purposes.
Under the terms of the financing, each unit consists of one common share and one common share purchase warrant. Each warrant entitles the holder to purchase one common share at a price of US$3.00 per warrant share on or prior to October 1, 2029.
The company has granted the lead agents an option to sell an additional up to 4.17 million units at the offering price. That option is exercisable in whole or in part at any time up to 48 hours prior to closing of the offering, which is expected to occur around November 12, 2024.
Details of the latest financing come after Osisko recently raised US$34.5 million after closing the final tranche of a private placement financing that will also be used to fund the advancement of its Cariboo and Tintic projects.
Osisko Development shares eased 20.7% or 73 cents to $2.97. The shares trade in a 52-week range of $4.52 and $2.32.
Osisko Development is aiming to become an intermediate gold producer by advancing its 100%-owned Cariboo gold project in central British Columbia, the Tintic project in Utah, and the San Antonio gold project in Sonora, Mexico.
The Cariboo project is located in the historic Wells-Barkerville mining camp and consists of three different sites, including the Mine Site Complex near the District of Wells, the Bonanza Ledge site and the QR Mill.
In the second quarter ended June 30, 2024, Osisko said it sold 805 ounces of gold from operating activities, consisting of 790 ounces sold from the Trixie test mine, and the balance from the Cariboo gold project by processing stockpiles at a third-party facility.
During the second quarter, the company posted $2.6 million in revenue, compared to $10.8 million in the second quarter of 2023.
On June 3, 2024, the company announced that in connection with the terms of its previously completed acquisition in May 2022 of a 100% ownership interest in the Tintic Project, Osisko said it had satisfied the second of five deferred payments to the sellers. The deferred consideration of US$2.5 million was settled by the issuance of 1.23 million common shares.
As previously stated, Osisko received the environmental assessment certificate for the Cariboo Gold Project in October 2023. The BC Mines Act and Environmental Management Act permits have been drafted and are currently under review by the company and the Mine Review Committee, the company said in its second quarter report.
Osisko also said it anticipates completing its permit application referral and receiving final construction and operating permits in the third quarter of 2024.