McEwen Mining Announces Closing of Flow-Through Financing
McEwen Mining announced the closing of a US$22 million (Cdn$30 million) public financing to fund exploration and development at the Fox Complex in Ontario. The financing will support exploration drilling and the underground access ramp development at Stock East and West. The proceeds are designated for Canadian Exploration Expenses (CEE) and Canadian Development Expenses (CDE), with 1,533,000 flow-through common shares issued at a blended average price of $14.36 (Cdn$19.59), a 19% premium to May 27th's closing price. After placement agents' fees, net proceeds were approximately US$20.8 million (Cdn$28.5 million). Cantor Fitzgerald led the syndicate of placement agents, with PearTree Securities structuring the flow-through donation placement. The offering was conducted under a shelf registration statement filed with the SEC and a multi-jurisdictional disclosure system prospectus in Canada.
- Closed US$22 million financing to fund exploration and development.
- Net proceeds of US$20.8 million after placement agents' fees.
- Issued shares at a 19% premium to closing price on May 27th.
- Funds allocated for new production growth at the Fox Complex.
- Cantor Fitzgerald led a syndicate of reputable placement agents.
- Share dilution from issuing 1,533,000 new flow-through common shares.
- High transaction costs, reducing total proceeds by US$1.2 million.
Insights
McEwen Mining Inc. has successfully closed a flow-through financing worth
However, investors should keep an eye on how effectively these funds are utilized in the coming quarters. The success of the exploration and development activities will be a key driver for future valuation. Moreover, the involvement of reputable placement agents like Cantor Fitzgerald and others adds credibility to the offering, suggesting robust institutional backing.
In the short term, this news might bolster investor sentiment, but long-term gains will hinge on tangible results from the Fox Complex.
The flow-through financing secured by McEwen Mining Inc. underscores a strategic move to capitalize on the tax-efficient investment structure in Canada. Flow-through shares allow investors to claim tax deductions on exploration expenses, making them particularly appealing in the resource sector. For McEwen, this financing method not only attracts investment but also aligns with its goal to intensify exploration at the Fox Complex. This geographic focus on the Timmins region, known for its prolific gold deposits, places McEwen in a promising position to enhance its resource base.
From a market dynamics perspective, ensuring that exploration leads to substantial resource discoveries will be critical to sustain market interest and stock performance. The premium pricing of the shares demonstrates a positive market sentiment, yet it also sets high expectations for McEwen’s exploration outcomes. Investors should be attentive to updates on drill results and development progress at the Fox Complex, as these will be pivotal in assessing the long-term impact of this financing.
Overall, the flow-through financing is a sound move within the mining industry context, provided the company delivers on its exploration promises.
TORONTO, June 14, 2024 (GLOBE NEWSWIRE) -- McEwen Mining Inc. (NYSE: MUX) (TSX: MUX) (“McEwen”) is pleased to report it has closed the previously announced public financing for US
The proceeds of this financing will be used exclusively for qualifying Canadian Exploration Expenses (within the meaning of subsection 66.1(6) of the Income Tax Act (Canada)) (“CEE”) and Canadian Development Expenses (within the meaning of subsection 66.2(5) of the Income Tax Act (Canada)) (“CDE”), including:
Part 1 (CEE) of the financing consists of a US
Part 2 (CDE) of the financing consists of a US
(Part 1 (CEE) and Part 2 (CDE) together being the “Offering”).
The Offering consisted of 1,533,000 flow-through common shares at a blended average price of
Cantor Fitzgerald Canada Corporation and Cantor Fitzgerald & Co. led a syndicate of placement agents for the Offering, which included Roth Capital Partners, LLC, A.G.P./Alliance Global Partners, and H.C. Wainwright & Co., LLC. PearTree Securities Inc. structured the flow-through donation placement.
The Offering was made pursuant to a shelf registration statement on Form S-3 (File No. 333- 275324) that was previously filed by McEwen in the United States and subsequently declared effective by the Securities and Exchange Commission (“SEC”) on January 2, 2024 and also pursuant to a preliminary and final multi-jurisdictional disclosure system prospectus (the “Canadian Base Shelf”) in Canada. McEwen filed a final prospectus supplement with the SEC in connection with the Offering and a Canadian final prospectus supplement to the Canadian Base Shelf under the “northbound” multi-jurisdictional disclosure system with securities regulatory authorities in some of the provinces of Canada other than Quebec (collectively, the “Prospectus Supplement”). The Offering was made only by means of a prospectus, including a prospectus supplement, forming a part of the effective registration statement. The Base Shelf Prospectus and the Prospectus Supplement are filed with the SEC and available on the SEC’s website at http://www.sec.gov or by visiting the SEDAR+ website at www.sedarplus.com.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements and information, including "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements and information expressed, as at the date of this news release, McEwen Mining Inc.'s (the "Company") estimates, forecasts, projections, expectations or beliefs as to future events and results, including but not limited to the expected use of proceeds of the Offering and the timing of the closing of the Offering. Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, risks and contingencies, and there can be no assurance that such statements and information will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements and information. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements and information include, but are not limited to, effects of the COVID-19 pandemic, fluctuations in the market price of precious metals, mining industry risks, political, economic, social and security risks associated with foreign operations, the ability of the corporation to receive or receive in a timely manner permits or other approvals required in connection with operations, risks associated with the construction of mining operations and commencement of production and the projected costs thereof, risks related to litigation, the state of the capital markets, environmental risks and hazards, uncertainty as to the calculation of mineral resources and reserves, and other risks. Readers should not place undue reliance on forward-looking statements or information included herein, which speak only as of the date hereof. The Company undertakes no obligation to reissue or update forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. See McEwen Mining's Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and other filings with the Securities and Exchange Commission, under the caption "Risk Factors", for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information regarding the Company. All forward-looking statements and information made in this news release are qualified by this cautionary statement.
The NYSE and TSX have not reviewed and do not accept responsibility for the adequacy or accuracy of the contents of this news release, which has been prepared by management of McEwen Mining Inc.
ABOUT MCEWEN MINING
McEwen Mining is a gold and silver producer with operations in Nevada, Canada, Mexico and Argentina. In addition, it owns approximately
| CONTACT INFORMATION 150 King Street West Suite 2800, PO Box 24 Toronto, ON, Canada M5H 1J9 Relationship with Investors: (866)-441-0690 Toll free (647)-258-0395 Mihaela Iancu ext. 320 info@mcewenmining.com | ||
FAQ
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