Minera Alamos closes book order for $110 million financing
Minera Alamos Inc. [MAI-TSXV] said it has closed the book order for its previously announced $110 million private placement offering. The company said the underwriters have received indications of interest for the full amount of the offering, including the $25 million underwriters’ option.
Minera Alamos is a gold production and development company, which has been undergoing the operational ramp up of its new Nicho Main pit at its 100%-owned Santana gold mine in Sonora, Mexico.
The announcement comes after Minera recently agreed to acquire Calibre USA Holdings Ltd. from Equinox Gold Corp. [EQX-TSX, EQX-NYSE] for $115 million, of which $90 million is payable in cash and $25 million in equity. Calibre USA holds a 100% interest in the producing Pan Gold Mine, Gold Rock Project and Illipah projects, located in Nevada. Pan is a heap leach gold operating producing 40,000 ounces, generating strong cash flow, given the current record gold price environment.
Post transaction, Minera said its asset base, when fully developed, will hold the potential to produce over 175,000 ounces of gold annually based on the current development plan for Copperstone [gold mine in Arizona], Cerro de Oro [oxide gold project in northern Zacatecas, Mexico] and Gold Rock.
Minera said it will use net proceeds of the offering to acquire Calibre USA Holdings. The company has said Equinox will not hold more than 9.99% of the issued and outstanding shares of Minera once the transaction is completed.
Closing of the offering is expected to occur in mid-September.
On Friday, Minera shares eased 1.49% or $0.005 to 33 cents. The shares trade in a 52-week range of 49 cents and 22.5 cents.
Commenting on the Equinox transaction Minera Alamos CEO Darren Koningen said: “This acquisition unlocks significant value in our late-stage project development pipeline and allows the company to leverage internal cash flow to significantly grow the company’s production profile over the next few years.
“Furthermore, the cash generated will provide our exploration team with the resources they require to demonstrate the true size potential of all existing projects, including Cerro de Oro, Copperstone and the newly acquired Pan complex.”
Minera Alamos has previously described Cerro de Oro as the company’s second industry-leading low capital intensity build with an initial planned production profile of 60,000 ounces per year for eight years for under $30 million of initial capital
Concurrent with the closing of the transaction, Jason Kosec agreed to join Minera Alamos as Chairman with a mandate to lead the company’s strategic growth initiatives and capital markets presence. Kosec is an experienced mining professional having spent over 15 years in the mining sector in various executive roles. He has spearheaded numerous capital markets transactions.