Gold79 aims to raise $4.0 million for Gold Chain drilling

Gold79 Mines Ltd. [AUU-TSXV, AUSVF-OTCQB] said it is launching a non-brokered private placement to raise up to $4.0 million. The company said it is pursuing the offering in connection with its previously announced proposed amalgamation with Bullet Exploration Inc [AMMO-TSXV].

In a press release on September 4, 2024, Gold79 said it had signed a definitive deal to acquire all the outstanding shares of Bullet Exploration. It said the transaction is expected to create a well-funded gold exploration company with a focus on the southwestern U.S.

Gold79 holds 100% earn-in option to purchase agreements on three gold projects, the Jefferson Canyon and Tip Top projects in Nevada and the Gold Chain project in Arizona. It also holds a 32.3% stake in the Greyhound Project, Nunavut, under a joint venture with Agnico-Eagle Mines Ltd. (AEM-TSX, AEM-NYSE).

The combined company will focus on delivering a maiden resource at its Gold Chain project, exploring the newly acquired Jefferson North Gold-Silver Project in Nevada to define its scale potential, and continue to work with Kinross Gold Corp. (K-TSX, KGC-NYSE) to get a maiden drill program at Jefferson Canyon underway.

Under the terms of the transaction and subject to Bullet shareholder approval, Bullet shareholders will receive one common share of Gold79 for every three shares of Bullet.

“The transaction between Gold79 and Bullet is a unique opportunity to consolidate exploration companies in the southwestern U.S.,’’ said Gold79 President and CEO Derek Macpherson. “The combined entity is going to have multiple projects at various stages of exploration, be well funded and have improved access to capital,’’ he said.

Meanwhile, Gold79 said it will undertake a non-brokered private placement consisting of 16 million units priced at 25 cents per unit. Each unit will consist of one Gold79 common shares and one half of a common share purchase warrant. Each whole warrant will entitle the holder to purchase one Gold79 share for 40 cents for 24 months after the date of issuance. However, the expiry date of the warrants could be accelerated, if, following the date of issuance, the 20-day volume-weighted average trading price of the Gold79 common shares on the TSX Venture Exchange or an alternative trading system is equal to, or greater than 60 cents for any 10 consecutive trading days.

“Pursuant to an amendment to the amalgamation agreement executed in connection with the transaction, the offering may close in tranches,’’ the company said in a press release.

“We plan to engage the drillers and mobilize the drill rig to the Gold Chain project as soon as possible once the financing closes,’’ said Macpherson.

Gold79 shares were unchanged Wednesday at 24 cents and trade in a 52-week range of 30 cents and 15 cents.