District Metals shares rally on Swedish financing news
District Metals Corp. [DMX-TSXV, DFPP-FSE] has raised $4.5 million from a bought deal private placement financing and will use the proceeds to fund the advancement of its projects in Sweden.
Under the terms of the offering, the company issued 20.5 million units priced at 22 cents per unit, each of which consists of one common share and one half of one transferable common share purchase warrant. Each whole warrant entitles the holder to acquire one additional common share for 30 cents for three years after closing.
Certain directors and officers of the company and a greater than 10% shareholder participated in the offering. District President and CEO Garrett Ainsworth, and directors Doug Ramshaw, Joanna Cameron, and Jonathan Challis each subscribed for 30,000 units. An insider, who the company did not name, subscribed for 3.2 million units.
District shares advanced on the news, rising 5.4% or $0.015 to 29 cents on Thursday. The shares trade in a 52-week range of 30 cents and $0.085.
District is a polymetallic exploration and development company with a focus on the Viken and Tomtebo projects in Sweden. The Viken property covers 100% of the uranium-vanadium Viken Deposit, an asset that has witnessed substantial exploration and development expenditures, resulting in the definition of large polymetallic resource estimates in 2010 and 2014. Viken is amongst the largest deposits of total historic mineral resources of uranium and vanadium in world.
“It is an exciting time for District given that we have recently consolidated 100% ownership of the uranium-vanadium Viken Deposit, as a new uranium bull market with sound fundamentals has recently emerged,’’ said Ainsworth.
The high-grade polymetallic Tomtebo Property is located in the Bergslagen Mining District in south-central Sweden.
District acquired a 100% interest in Tomtebo from EMX Royalty Corp. [EMX-TSXV] in June 2020. That project is currently the company’s main focus.
The Tomtebo Property is located within a 2.5-hour drive northwest of Stockholm, Sweden’s capital city. The advanced stage exploration property encompasses an area of 5,144 hectares, and is situated 25 kilometres northwest of Boliden’s polymetallic Garpenberg Mine, and 25 kilometres southeast of the historic Falun Mine.
The company says Tomtebo contains similar host rocks, structure, alteration, and VMS/SedEx style mineralization as the nearby Garpenberg and Falun mines. The size and scale of these mines has only been revealed within the last two decades through a better understanding of the associated polymetallic-VMS/SedEX mineralizing systems, and through advances in drilling and mining technology.
Mining at Tomtebo can be traced back to the mid-seventeenth century. Two historic mines, and numerous mineralized prospects are situated on a 17-kilometre trend on the property. Historic production consisted of 120,000 tonnes of 4.4% copper at the Tomtebo Mine, and 330,000 tonnes at 3.5% zinc, 2.5% lead, and 30 g/t silver at Lovas. However, mining depths reached down to approximately 200 metres. Based on available cross sections and long sections, mineralization at Tomtebo and Lovas appears to be open in all directions, the company has said.