Wallbridge Mining unveils $56 million bought deal

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Wallbridge Mining Co. Ltd. [WM-TSX; WC7-FWB] said Wednesday September 16 it is raising $56 million from a bought deal offering of 49 million shares priced at $1.15 per share.

The company said the net proceeds will be used to continue advancement of its flagship project in Quebec and for general corporate purposes.

Wallbridge shares were active on the news, easing 3.5% or $0.04 to $1.26 on volume of over 3.93 million. The shares trade in a 52-week range of $1.35 and 31 cents.

News of the financing comes just one day after Wallbridge said it had signed a non-binding term sheet that could potentially allow Kirkland Lake Gold Ltd. [KL-TSX, NYSE; KLA-ASX] to earn a 75% stake in Wallbridge’s Detour East gold property, also located in Quebec. To earn the interest, Kirkland Lake would be required to spend $35 million.

Wallbridge has been working to establish a pipeline of projects that will support sustainable production and revenue as well as organic growth through exploration and scalability.

Its portfolio includes the Fenelon Gold property located in northwestern Quebec, about 75 km northwest of Matagami. The project is proximal to the Sunday Lake Deformation Zone, which hosts Kirkland Lake’s Detour Gold Mine in Ontario and gold deposits at Martiniere.

In March of 2018, former owner Balmoral Resources published an initial resource estimate for the Martiniere Gold System, which is thought to contain 591,000 ounces Indicated and 54,000 ounces Inferred.

Wallbridge acquired the Detour East property as part of its $110 million all-share acquisition of Balmoral Resources in May, 2020, adding 739 km2 of ground within the Detour Fenelon gold trend to its portfolio.

Wallbridge President and CEO Marz Kord said the proposed joint venture with Kirkland Lake would allow Wallbridge to focus on its Fenelon gold property while advancing exploration at Detour East.

On Wednesday, Wallbridge said Kirkland Lake Gold has certain participation rights and will participate in the bought deal financing, thereby increasing its post-closing stake in Wallbridge to approximately 9.9%.

The company granted the underwriters up to an additional 15% of the shares issued in connection with the bought deal offering to cover potential over-allotments.

Since acquiring the property in 2016, Wallbridge has demonstrated the Fenelon project’s potential to host a multi-million-ounce gold deposit. The first  resource estimate is expected by 2021.

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