Lundin family backs upsized Montage Gold financing
Montage Gold Corp. [MAU-TSXV, MAUTF-OTCQX] said Friday it is upsizing a previously announced non-brokered private placement financing, which is now expected to generate $35 million in gross proceeds. That’s up from the original $20 million target. The financing includes a strategic investment by the Lundin Family Trust, which is increasing its stake in the company to 19.9%, as Montage embarks on a strategy to create a leading multi-asset gold producer with a focus on Africa.
Net proceeds of the offering, which has been increased to 50 million shares, priced at 70 cents each, will be used for exploration and development expenses at the company’s Kone Gold project in Cote d’Ivoire and for working capital purposes. The offering is expected to close on March 11, 2024.
Montage is a Canadian precious metal exploration and development company with a focus on the Cote d’Ivoire. Kone is the company’s flagship property and is located in northwest Cote d’Ivoire. The project is estimated to host a probable reserve of 174.3 million tonnes of grade 0.72 g/t or 4.01 million ounces.
Back in January 16, 2024, the company released the results of an updated feasibility study at Kone, outlining a 16-year gold project, producing 3.57 million ounces of gold at an all-in-sustaining cost of US$998 per ounce over the life of the mine. Average production is forecast at 223,000 ounces, reaching a peak of 378,000 ounces.
Along with the financing, Montage said it is expanding its leadership team. Martino De Ciccio has been named CEO. Peder Olsen has been appointed as Chief Development Officer. Ron Hochstein is joining the company’s board of directors, effective immediately.
Both Martino and Peder have more than 15 years of experience in the mining industry with a strong value creation track record and a profound understanding of the African mining landscape. Both played key roles in building Endeavour Mining Corp. (EDV-TSX, EDVMF-OTCQX,) into a top 10 global gold producer and the largest in West Africa.
Richard Clark, co-founder and current CEO, will step down from his CEO role but will remain on the board of directors. “We are very pleased to add to our management team and welcome the significant investment by the Lundin Group, which we believe will unlock value for shareholders as we seek to propel Montage forward,’’ said Clark.
Martino most recently served as Deputy CFO and Head of Investor Relations at Endeavor Mining, a position he assumed in 2023. He brings significant knowledge across strategy, capital markets, corporate finance, and ESG, while Peder brings considerable project development experience as he played a key role in building a number of West African gold mines.
“Ron will provide significant oversight and leadership by leveraging his most recent experience in financing development and construction of the Fruta del Norte project for Lundin Gold Inc. [LUG-TSX],” the company said in a press release.
Montage Gold shares were unchanged Friday at 67 cents and currently trade in a 52-week range of 79 cents and 51 cents.