Allied Gold arranges $80 million bought deal financing

Allied Gold Corp. [AAUC-TSX, AAUCF-OTCQX], a company formed by former executives of Yamana Gold, has announced details of an $80 million bought deal financing.

The company said an underwriting syndicate has agreed to purchase, on a bought deal basis, 15 million common shares for $5.35 per share.  Allied said a significant shareholder of the company, owning over 10% of the outstanding shares, will enter into a selling agreement with the co-lead underwriters to sell 15 million shares at the offering price, on a block trade, prospectus exempt basis, for total proceeds to the selling shareholder of approximately $80 million. The offering and the block trade will be completed concurrently.

Allied Gold said enhancements of market liquidity is one of the stated objectives of the company, particularly in contemplation of the intended listing of the common shares on the New York Stock Exchange.  The listing is expected to provide the opportunity for broader index inclusion.

Meanwhile, the company has granted the underwriters an option to purchase up to an additional 15% or 2.225 million shares at the offering price. That option can be exercised at any time, for 30 days after and including the closing, which is expected to occur on April 22, 2025.

Allied is a Canadian gold producer. It operates a portfolio of three producing assets and development projects located in Cote d’Ivoire, Mali and Ethiopia. Allied has said it aspires to become a mid-tier next-generation gold producer in Africa and ultimately, a leading senior global gold producer.

Allied produced a record 99,632 ounces of the yellow metal in the fourth quarter of 2024 marking a 16% increase over the average production of the three previous quarters last year.

That was consistent with Allied’s previous outlook and guidance that annual production from its producing mines was expected to be 375,000 to 400,000 ounces of gold, with production in the fourth quarter supporting that annualized production range.

Key contributors to the company’s record Q4 production include the Sadiola mine in Mali, where increased production of 54,210 ounces was driven by a full quarter of production from the Korali oxide ore of approximately 48,000 ounces. The company has previously indicated that Korali is an interim step pending the completion of the first-phase expansion at Sadiola to achieve consistent annual production of 200,000 to 230,000 ounces.

Part of the proceeds of the bought deal to advance studies and engineering for recovery increases at Sadiola, exploration and studies aimed to increase mine life in Ivory Coast, and additional exploration work and development across the portfolio of asset.

Allied Gold shares eased 7.1% or $0.41 to $5.35 in early trading Thursday. The shares trade in a 52-week range of $5.98 and $2.69.