Sprott takes 24% stake in TRU Precious Metals, shares rally

Share this article

Mining financier Eric Sprott has emerged as a major shareholder of TRU Precious Metals Corp. [TRU-TSXV; TRUIF-OTCQB; 706-FSE], a company that is engaged in gold exploration in Newfoundland.

TRU shares rallied on the news, rising 12.7% or $0.04 to 35.5 cents on volume of 493,500. The shares are currently trading in a 52-week range of 52 cents and 12 cents.

A numbered company beneficially-owned by Sprott has purchased 9.09 million units of TRU for 22 cents each for an aggregate consideration of $2 million.

TRU welcomed Sprott as a major shareholder after announcing the completion of a non-brokered private placement that raised gross proceeds of $3.5 million from an offering of 12.9 million flow-through units priced at 27 cents each.

Each flow-through unit consists of one common share of TRU that qualifies as a “flow-through share” under the Income Tax Act of Canada, and one “flow-through” common share purchase warrant. Each flow-through warrant is exercisable into one common share of TRU at 35 cents a share until June 17, 2024.

The units acquired by Sprott were purchased by way of a private agreement with a single vendor.

As a result, he beneficially owns and controls 9.09 million shares and the same number of warrants representing approximately 13.7% of the outstanding shares on a non-diluted basis and approximately 24% on a partially diluted basis assuming exercise of warrants.

Prior to this acquisition, Sprott did not own any securities in the company.

TRU has assembled a portfolio of five gold exploration properties in the highly prospective Central Newfoundland Gold Belt. The company has an option with a subsidiary of Altius Minerals Corp. [ALS-TSX, ATUSF-OTCQX] to purchase 100% of the Golden Rose Project, located along the deposit-bearing Cape Ray-Valentine Lake Shear Zone.

TRU also owns 100% of the Twilite Gold Project, located along the same shear zone, and three under-exploration properties, including its Rolling Pond property bordering New Found Gold Corp.’s [NFG-TSXV] Queensway Project.

TRU said proceeds of the private placement will be used by the company to fund a two-phase exploration program at the flagship Golden Rose project, and a targeted and recently expanded phase one drilling program at the Twilite Gold project.

Golden Rose lies on strike with Marathon Gold Corp.’s [MOZ-TSX, OTC-MGDPF] Valentine Gold Project. Where Marathon recently reported a maiden resource estimate for the Berry Zone.

Marathon said it has outlined an inferred resource of 639,000 ounces of gold (11.3 million tonnes at 1.75 g/t). It said 89% of the total estimate is an open pit resource of 566,400 ounces, with the balance associated with underground.


Share this article

Leave a Reply

Your email address will not be published. Required fields are marked *

Don't miss the

NEWSLETTER

Exclusive editorial

Breaking News

Quality Company Coverage

Expert Writers

You have successfully subscribed to the newsletter

There was an error while trying to send your request. Please try again.

Resource World Magazine will use the information you provide on this form to be in touch with you and to provide updates and marketing.