- McEwen Mining (MUX) has raised approximately C$13.7 million in a private placement to fund exploration work at its projects in Ontario
- The company issued 6.3 million flow-through shares at a price of $2.18 through a syndicate of underwriters led by Cantor Fitzgerald Canada
- McEwen Mining has a number of properties in Ontario’s Timmins Gold Mining Camp, including the Black Fox Complex and its Lexam properties
- The financing comes off the back of a disappointing second quarter of 2020, in which the company posted a substantial drop in gold and silver revenue
- McEwen Mining (MUX) is currently up 3.52 per cent and is trading at $1.32 per share
McEwen Mining (MUX) has raised approximately C$13.7 million in a private placement to fund exploration work at its projects in Ontario.
Under the terms of the placement, which was announced on August 18 this year, the Toronto-based company issued a total of 6,298,166 flow-through shares at a price of $2.18 each.
The offering was completed through a syndicate of underwriters led by Cantor Fitzgerald Canada as sole bookrunner, which included Roth Capital Partners, Red Cloud Securities and Maison Placements Canada.
McEwen Mining says the proceeds will be used exclusively to fund “generative” exploration work at its properties in the Timmins Gold Mining Camp of northern Ontario.
These include the Black Fox Complex and the company’s Lexam operations, which consist of the Buffalo Ankerite, Fuller, Paymaster and Davidson Tisdale properties.
All of the Lexam properties are past producers, with Buffalo Ankerite previously generating 1.02 million ounces of gold at an average grade of 6.5 grams per tonne, primarily from a 4,000-foot deep production shaft.
The financing comes at a pivotal time, just over one month after it reported a significant decline in gold and silver revenue in its second quarter financial results.
Total gold production for the quarter came in at 15,700 ounces, compared to 36,200 in the same period last year, while silver production fell from 850,500 ounces to 359,400 ounces.
This resulted in a slide in sales revenue from $48 million in the second quarter of 2019 to just over $24 million this year, which in turn gave way to an increase in net loss from $17 million to more than $26 million.
Rob McEwen, Executive Chairman of McEwen Mining, said at the time that the period was challenging from both an operational and health and safety perspective.
“I very much wish I could say that all our difficulties that started last year are now behind, but they are not, yet. Our significantly lower production not only reduced our revenue, but also dramatically increased our costs per ounce.
“We are in a transition period setting up for future growth. We have a large resource base, four operating mines and can see an exciting organic growth pipeline of projects ahead that could potentially push our production to 300,000 ounces per year,” he added.
McEwen Mining (MUX) is currently up 3.52 per cent and is trading at $1.32 per share at 3:21pm EDT.