Sanu Gold closes $10.05 million investment from Montage & Lundin
Sanu Gold Corp. [CSE: SANU; OTCQB: SNGCF; FRA: L73] has completed a strategic investment by Montage Gold Corp. and the Lundin family and associates into Sanu Gold for a total value of $10,055,412.
Highlights: Montage Gold obtained a 19.9% ownership stake in Sanu Gold through the issuance of 2,337,921 common shares of Montage Gold in exchange, equating to approximately $5.5-million value.
The Lundin family obtained a 10% stake in Sanu Gold, joining AngloGold Ashanti PLC, which maintains a 10% stake in Sanu, respectively.
Strategic collaboration: Montage Gold’s CEO, Martino De Ciccio, has been appointed as chair of Sanu Gold’s board of directors, with Silvia Bottero, executive vice-president, exploration, joining as technical adviser.
Exploration focus: Proceeds from these investments will finance exploration activities in Guinea, West Africa, targeting the highly prospective Daina, Diguifara and Bantabaye permits.
The company has completed a share exchange transaction with Montage Gold for an investment by Montage Gold in Sanu Gold consisting of the issuance of common shares of Montage Gold having a market value of $5,494,115 in exchange for the issuance of an equivalent value of common shares of Sanu Gold at a deemed price of 7.2 cents per Sanu common share, pursuant to an investment agreement between the company and Montage Gold.
Montage Gold is approximately a 19.9% shareholder in Sanu Gold after the share exchange transaction and offering (as defined herein). The company also announced the closing of a non-brokered private placement of 4,945,304 Sanu common shares at 7.2 cents per Sanu common share for an aggregate total of $4,561,297, led by members of the Lundin family and associates. The Sanu common shares issued under the share exchange transaction and the offering are subject to a four-month-and-one-day hold.
The company expects to use the net proceeds of the offering to advance exploration, including geophysics and drilling on the company’s Daina, Diguifara and Bantabaye gold exploration permits in Guinea, West Africa, and for general and administrative purposes.
Martin Pawlitschek, CEO of Sanu Gold, commented: “This marks a transformative step forward for Sanu Gold. The investments from Montage Gold and the Lundin family, following earlier investments by AngloGold Ashanti PLC and Capital DI, provide us with the capital, expertise and strategic support needed to accelerate exploration on our high-potential gold projects in Guinea. With Martino De Ciccio joining as chair of the board, we are well positioned to create significant value for our shareholders.”
Under the share exchange transaction, Sanu received 2,337,921 Montage shares at a deemed price per Montage share of $2.35 in exchange for the issuance of 76,307,155 Sanu common shares at a deemed price of 7.2 cents per Sanu common share, representing approximately 19.9% of Sanu Gold after the share exchange transaction and offering. In connection with the share exchange transaction, Mr. De Ciccio, CEO of Montage Gold, has been appointed chair of Sanu Gold.
In connection with the share exchange transaction, Sanu Gold has entered into an investor rights agreement between Montage Gold and the company. The Montage investor rights agreement will, subject to certain conditions, including ownership thresholds by Montage Gold, include the right to participate in future equity issuances to maintain its ownership in the company, participation and top-up rights, a board member nominee, a right of first refusal on certain asset-level transactions for Daina and Bantabaye, and the formation of a technical advisory committee.
Eventus Capital Corp. has been appointed as the finder for share exchange transaction and received a finder’s fee of 5,341,501 Sanu common shares at a deemed price of 7.2 cents, which are subject to a four-month hold period under applicable Canadian securities laws and will be subject to a resale restriction expiring four months and one day from the closing date.
AngloGold Ashanti as well as two directors and officers of the Sanu Gold acquired an aggregate of 5,639,748 Sanu common shares under the offering for a total purchase price of $406,061.86. The participation by the related parties in the offering constitutes a related party transaction as defined under MI 61-101, Protection of Minority Security Holders in Special Transactions.
AngloGold Ashanti Holdings PLC acquired an additional 4,945,304 Sanu common shares under the offering. The investor is a wholly owned direct subsidiary of AngloGold Ashanti and acquired the foregoing Sanu common shares in connection with the exercise of the investor’s participation right under an existing investor rights agreement (IRA) between AngloGold Ashanti and Sanu Gold.
Immediately prior to the offering, the investor had beneficial ownership of 33.4 million Sanu common shares, representing approximately 14.0% of the issued and outstanding common shares on a non-diluted basis. Immediately after the offering and the share exchange transaction, including the investor’s acquisition of 4,945,304 Sanu common shares under the offering, the investor had beneficial ownership of 38,345,304 common shares, representing approximately 10.0 per cent of the issued and outstanding Sanu common shares on a non-diluted basis.
Sanu Gold has approved the grant of 13,475,000 stock options to certain officers, directors, employees and consultants of the company under the company’s stock option plan. The options vest in equal intervals over a two-year period following the grant date, are exercisable to purchase one Sanu common share at a price of 16 cents and expire on Dec. 31, 2029.
Located within the Siguiri basin, a world-class gold district that is host to several operating mines and major new discoveries, Sanu Gold is exploring three high-quality gold exploration permits in Guinea, West Africa. The company has defined multi-kilometre-long, gold-bearing structures on each of the gold exploration permits, with multiple high-value drill targets, and is targeting multimillion-ounce-gold discoveries.