IAMGOLD Completes US$300 Million Bought Deal Financing
IAMGOLD (TSX: IMG, NYSE: IAG) has completed a US$300.24 million bought deal financing by issuing 72,000,000 common shares at US$4.17 each. The proceeds will be used to repurchase a 9.7% interest in the Côté Gold Mine from Sumitomo Metal Mining Co., restoring IAMGOLD's 70% interest. The Offering, conducted by National Bank Financial Markets, BMO Capital Markets, and RBC Capital Markets, was announced on May 21, 2024, and closed on May 24, 2024. Funds will be deposited or used to repay credit facility amounts until the repurchase is finalized by year-end. A registration statement has been filed with the SEC.
- Raised US$300.24 million from bought deal financing.
- Issuance of 72,000,000 common shares at US$4.17 each.
- Proceeds will be used to repurchase a 9.7% interest in the Côté Gold Mine.
- Restores IAMGOLD's 70% interest in the Côté Gold Mine.
- Offering led by reputable financial institutions including National Bank Financial Markets, BMO Capital Markets, and RBC Capital Markets.
- Dilution risk for existing shareholders due to the issuance of 72 million new shares.
- Dependency on successful repurchase from Sumitomo to achieve the intended 70% ownership.
- Funds temporarily tied up in an interest-bearing account or used for credit repayment, may not be immediately available for other investments.
The closing of IAMGOLD's $300 million bought deal financing is of significant importance. Bought deal financings are a form of equity financing where underwriters purchase shares from a company and then sell them to investors, often indicating strong demand and confidence in the company's future. The offering price of $4.17 per share is a critical data point that investors will watch closely, as it reflects market sentiment at the time of the offering.
The primary use of proceeds is to reclaim the 9.7% interest in the Côté Gold Mine from Sumitomo Metal Mining Co. By doing so, IAMGOLD will restore its 70% ownership stake in this mine, which can be seen as a strategic move to consolidate its assets and potentially increase its future revenue from this project. This also means IAMGOLD sees substantial long-term value in owning a larger share of the Côté Gold Mine.
From a financial perspective, this dilution of shares might temporarily impact the share price negatively. However, the strategic repurchase of the mine interest could be a positive driver for future earnings and company value. Investors should consider the balance between short-term dilution effects and long-term potential gains when assessing this move.
This financing round indicates a robust market appetite for IAMGOLD's shares, as it involves well-known underwriters like National Bank Financial Markets, BMO Capital Markets and RBC Capital Markets. This can be indicative of a stable or positive market perception of IAMGOLD's potential, especially within the precious metals sector.
The Côté Gold Mine is a significant project and increasing its stake back to 70% signals IAMGOLD's commitment to and confidence in the mine's long-term profitability. The mine's output and operational efficiencies will be important metrics to monitor going forward. Additionally, this move may position IAMGOLD more favorably against competitors by enhancing its asset base.
Investors should be aware that the success of this strategy hinges on the performance of the Côté Gold Mine and broader market conditions for gold. Given the company's strengthened asset position, there could be long-term benefits, but these are counterbalanced by the immediate dilution in share value.
The filing of a registration statement with the SEC is a necessary legal step for this equity financing. This ensures compliance with U.S. securities laws and provides transparency for investors. The involvement of reputable financial institutions as underwriters further bolsters the legal and regulatory credibility of the offering.
Additionally, the repurchase of the 9.7% interest in the Côté Gold Mine involves intricate legal documentation and negotiations. Investors should be aware that such transactions entail legal risks, including due diligence and potential regulatory approvals. However, IAMGOLD's established track record and the involvement of reputable legal entities likely mitigate major legal concerns.
The legal framework surrounding this deal appears robust, which should give investors a certain level of confidence in the legitimacy and thoroughness of the transaction.
Toronto, Ontario--(Newsfile Corp. - May 24, 2024) - IAMGOLD Corporation (TSX: IMG) (NYSE: IAG) ("IAMGOLD" or the "Company") is pleased to announce the closing of its "bought deal" equity financing of 72,000,000 common shares of the Company (the "Offering"). At a price of US
IAMGOLD intends to use the net proceeds of the Offering towards the repurchase of the
US Registration Statement Filing
A registration statement relating to these securities has been filed with the U.S. Securities and Exchange Commission ("SEC"). Documents filed with the SEC may be obtained for free on the SEC's Electronic Data Gathering, Analysis and Retrieval system at www.sec.gov or from National Bank of Canada Financial Inc., 65 E. 55th St., 8th Floor, New York, New York 10022; by phone at (416) 869-8414 or by e-mail at NBF-Syndication@bnc.ca; from BMO Capital Markets Corp., Attention: Equity Syndicate Department, 151 W 42nd Street, 32nd Floor, New York, New York 10036, by phone at (800) 414-3627 or by email at bmoprospectus@bmo.com; and from RBC Capital Markets, LLC, 200 Vesey Street, 8th Floor, New York, NY 10281-8098; Attention: Equity Syndicate; by phone at 877-822-4089 or by email at equityprospectus@rbccm.com.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the common shares in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.
Cautionary Statement on Forward-Looking Information
This news release contains forward-looking statements. All statements, other than of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements with respect to the use of the proceeds of the Offering) are forward-looking statements. Forward-Looking statements are generally identifiable by use of the words "may", "will", "should", "would", "could", "continue", "expect", "budget", "aim", "can", "focus", "forecast", "anticipate", "estimate", "believe", "intend", "plan", "schedule", "guidance", "outlook", "potential", "seek", "targets", "cover", "strategy", "during", "ongoing", "subject to", "future", "objectives", "opportunities", "committed", "prospective", or "project" or the negative of these words or other variations on these words or comparable terminology. The Company cautions the reader that forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, financial, operational and other risks, uncertainties, contingencies and other factors, including those described below, which could cause actual results, performance or achievements of the Company to be materially different from results, performance or achievements expressed or implied by such forward-looking statements and, as such, undue reliance must not be placed on them. Forward-Looking statements are also based on numerous material factors and assumptions, including with respect to: the Company's present and future business strategies; operations performance within expected ranges; anticipated future production and cash flows; the Company's ability to repurchase the Transferred Interest on its expected terms or at all; local and global economic conditions and the environment in which the Company will operate in the future; the price of precious metals, other minerals and key commodities; projected mineral grades; international exchanges rates; anticipated capital and operating costs; the availability and timing of required governmental and other approvals for the construction of the Company's projects.
Forward-Looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company's ability to control or predict, that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements. Factors that could cause actual results or events to differ materially from current expectations include, among other things, without limitation, failure to meet expected, estimated or planned gold production, unexpected increases in all-in sustaining costs or other costs, unexpected increases in capital expenditures and exploration expenditures, variation in the mineral content within the material identified as Mineral Resources and Mineral Reserves from that predicted, changes in development or mining plans due to changes in logistical, technical or other factors, the possibility that future exploration results will not be consistent with the Company's expectations, changes in the Company's relationship with Sumitomo, instability in financial markets, currency exchange risk, changes in world gold markets, cybersecurity risks, and other risks disclosed in IAMGOLD's most recent Form 40-F and Annual Information Form and in IAMGOLD's management's discussion and analysis of financial position and results of operations for the first quarter ended March 31, 2024 on file with the SEC and Canadian securities regulatory authorities. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement.
About IAMGOLD
IAMGOLD is an intermediate gold producer and developer based in Canada with operating mines in North America and West Africa. The Company has commenced production at the large-scale, long life Côté Gold Mine in partnership with Sumitomo Metal Mining Co. Ltd., which is expected to be among the largest gold mines in Canada. In addition, the Company has an established portfolio of early stage and advanced exploration projects within high potential mining districts. IAMGOLD employs approximately 3,600 people and is committed to maintaining its culture of accountable mining through high standards of Environmental, Social and Governance practices, including its commitment to Zero Harm®, in every aspect of its business. IAMGOLD is listed on the New York Stock Exchange (NYSE: IAG) and the Toronto Stock Exchange (TSX: IMG) and is one of the companies on the Jantzi Social Index, a socially screened market capitalization-weighted index consisting of companies which pass a set of broadly based environmental, social and governance rating criteria.
IAMGOLD Contact Information
Graeme Jennings, Vice President, Investor Relations
Tel: 416 360 4743 | Mobile: 416 388 6883
Toll-free: 1 888 464 9999
info@iamgold.com
All material information on IAMGOLD can be found at http://www.sedarplus.ca or at www.sec.gov.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/210383
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