Andean Silver (ASX:ASL) has received firm commitments totalling $40 million via a placement to institutional and sophisticated investors to accelerate production restart activities and resource growth at its Cerro Bayo Silver-Gold Project in Chile.
The placement was priced at $2.45 per share, representing a 13.7% discount to the last sale price and a 5.8% discount to the 10-day volume weighted average price. Settlement is scheduled for 8 September 2026.
Proceeds will see Andean emerge with pro-forma cash of approximately $82.7 million, based on $42.7 million cash on hand as at 30 June 2026, plus the $40 million placement before costs.
Managing Director Matt Allen says the placement puts Andean in an ‘extremely strong’ position to create further growth on several fronts simultaneously.
“We will maintain our aggressive drilling campaign with six rigs turning,” Allen says.
“This is aimed at driving further growth in the resources by pursuing extensions to known mineralisation and testing the huge number of mineralised veins already identified across the project.
“We also intend to continue converting inferred resources to the indicated category.
“This work will give us another avenue of value creation as we demonstrate the production and cashflow potential of Cerro Bayo.”
Andrean has earmarked proceeds towards a drilling fleet of six rigs upgrading current mineral resources to measured and indicated categories and testing key growth targets.
Greenfield permitting is also underway, targeting more than 200 drill pads in the Juanita to Droughtmaster corridor for drilling commencing in the second half of 2027.
Andean intends to deliver a Scoping Study within six months and a Feasibility Study with maiden ore reserve by the end of 2027. The company also plans to commence early works for restart activities, including mill refurbishments, underground dewatering, and infrastructure upgrades.
The Cerro Bayo Project currently hosts indicated and inferred mineral resources of 20 million tonnes at a grade of 211 grams per tonne for 136 million ounces of contained silver equivalent.
Canaccord Genuity and Euroz Hartleys acted as joint lead managers and bookrunners to the placement, with Jett Capital Advisors acting as co-manager. The company determined it was unable to undertake a further share purchase plan within 12 months of its previous offering without preparing a prospectus.
Andean Silver is a mineral explorer and developer focused on its flagship Cerro Bayo project in the Aysen region of Southern Chile.
Write to Paula Fabe at Mining.com.au
Images: Andean Silver
