GoviEx Uranium closes $13.8 million bought deal
GoviEx Uranium Inc. [GXU-TSX, GVXXF-OTCQB] said Friday it has raised $13.8 million from a bought deal offering of 86.25 million units priced at 16 cents per unit. The offering has closed after over-allotment options available to the underwriter were fully exercised.
Under the terms of the offering, each unit consists of one common share and one common share purchase warrant. Each warrant entitles the holder to purchase one common share for an exercise price of the U.S. equivalent of 21 cents or US$0.16. for 36 months following the date of closure.
GoviEx Executive Chairman and director Govind Friedland acquired 8.5 million units. Director Eric Kraft also acquired 8.5 million units. Both are considered company insiders. As a result, their participation was considered to be a related party transaction.
GoviEx shares eased 3.2% or $0.005 to 15 cents on volume of 371,040. The shares trade in a 52-week range of 25.5 cents and 10.5 cents.
GoviEx is focused on the exploration and development of its African uranium properties. Its principal objective is to become a significant uranium producer via the continued exploration and development of its mine-permitted Madaouela project in Niger, its mine-permitted Mutanga Project in Zambia, and its multi-element Falea Project in Mali.
The company’s shareholders include Cameco Corp. [CCO-TSX, CCJ-NYSE], Denison Mines Corp. [DML-TSX], and privately-owned Ivanhoe Industries.
The company said it will use the bought deal proceeds to fund exploration, engineering, and for general corporate and working capital purposes, including for the Muntanga project and development of the company’s financing options for the Madaouela project.
GoviEx recently announced an updated mineral resource estimate for its Mutanga Project. It consists of three mining permits that cover 720 square kilometres and contain five deposits, Dibbwi, Dibbwi East, Muntanga, Gwabi and Njame.
The 2023 updated mineral resource estimate is the result of extensive infill drilling, including 8,010 metres drilled in 2021 and 19,990 metres drilled in 2022, predominantly in the Dibbwi East deposit, to further delineate the deposit and convert inferred resources to the indicated category.
Measured and indicated resources now stand at 42.6 million tonnes of grade 359 ppm U308 or 33.7 million pounds of U308. On top of that is an inferred resource of 15 million tonnes of 330 ppm U308 or 10.9 million pounds of U308.
The company said measured and indicated resources have nearly tripled from previous estimates, and now represent 74% of total resources, up from 29%. Total in-pit constrained resources have increased by 18% from earlier estimates.
The Madaouela Project is located near Arlit in north central Niger, a key area for sandstone-hosted uranium deposits. The project is controlled 100% by the Nigerian mining company Compagnie Miniere Madaouela SA (COMIMA), owned 80% by GoviEx and 20% by the Government of the Republic of Niger.
Madaouela hosts 100 million pounds of U308 in the measured and indicated resource category. On top of that is an inferred resource of 20 million pounds. Feasibility results were announced on September, 2022.