Gold mining company, i-80, announces a public offering of securities worth $135 million through a bought deal.
Modified Gold Stock: i-80 Gold (NYSE: IAUX) takes a 13.5% hit in pre-market trading today, following the announcement of a bought deal agreement. This agreement sees a syndicate of underwriters, headed by National Bank Financial Inc. and Cormark Securities Inc., buying a whopping 270M units of the company at a price of US$0.50 per unit, garnering a grand total of US$135M in gross proceeds.
The nitty-gritty: Each unit sold comes with one common share and half a common share purchase warrant. Each full warranty allows you to buy another common share for US$0.70 within the next 30 months. The warrants' expiration date is set for 30 months after the offering's closing. The underwriters also hold an over-allotment option, potentially netting an extra 15% of units (up to 40.5 million) if they choose to exercise it. This option is good for 30 days after the offering's closing and can be used in its entirety or in parts.
Motives and Plans: The company intends to utilize the raised funds for funding growth investments in its new development plan in Nevada and for general corporate purposes.
Timeline: The offering's closure is anticipated around May 16, 2025.
In essence, this US$135 million bought deal financing is designed to empower i-80 Gold with the capital needed to boost its development projects and meet general corporate requirements. Moreover, this package offers investors shares and warrants, granting them the opportunity to capitalize on potential future upside at a US$0.70 strike price for the next 30 months. The over-allotment option's inclusion provides flexibility for the company to capture additional funds should demand remain strong. [1][3]
The syndicate of underwriters, led by National Bank Financial Inc. and Cormark Securities Inc., will close a deal to buy 270M units of i-80 Gold (IAUX) on Friday, potentially raising US$135M. Each unit includes a common share and half a warrant, offering investors an opportunity to buy additional shares at US$0.70 over the next 30 months. The closing of the deal is expected on May 16, 2025, and the underwriters hold an over-allotment option to secure up to 40.5 million additional units if demand remains strong. i-80 Gold aims to use the raised funds for growth investments in its new development plan in Nevada and for other corporate purposes.
