The subsidiary of McEwen Mining Inc. [MUX-TSX; NYSE], McEwen Copper Inc., has closed the first tranche of the Series B private placement offering announced on July 6, 2021, issuing 4 million common shares at a price of $10 per share for gross proceeds of $40-million. All amounts are in U.S. dollars.
Subscription for the remaining four million common shares is available to qualified accredited investors, subject to a $1-million minimum investment and certain other conditions. The securities sold in the offering are private and subject to transfer restrictions until after such time as shares of McEwen Copper become listed on a public exchange. The second tranche of the offering is expected to close on or before Sept. 30, 2021.
Rob McEwen is Executive Chairman and Chief Owner of McEwen Mining. McEwen’s investment corporation, Evanachan Ltd., purchased all the shares issued pursuant to the first tranche of the offering. Following completion of the offering, McEwen beneficially owns 18.6% of McEwen Copper, which holds a 100% interest in the Los Azules copper project in San Juan, Argentina, and a 100% interest in the Elder Creek exploration property in Nevada, subject to a 1.25% net smelter return (NSR) royalty on both assets payable to McEwen Mining.
McEwen Copper intends to pursue an initial public listing within 12 months from the final closing of the offering. Proceeds from the offering will be used exclusively by McEwen Copper to advance the Los Azules project to a prefeasibility study, construction of a new year-round access road to the project, infill and exploration drilling at Los Azules and Elder Creek, environmental permitting and community relations, and general corporate purposes. Construction of the new access road is currently under way and has advanced 10 miles (16 km) of the approximate 72-mile (115 km) planned length.
A positive PEA stated that Los Azules includes an updated resource estimate, incorporating the results of the 2016-2017 drilling program. The copper resource contains 10.2 billion pounds in the Indicated category and 19.3 billion pounds in the Inferred category,
McEwen Mining is relying on the exemption set forth in Section 602.1 of the Toronto Stock Exchange company manual, which provides that the TSX will not apply certain of its requirements to issuers whose shares are listed on another recognized stock exchange such as the New York Stock Exchange.