Miata Metals (TSX-V:MMET) has secured C$20.2 million ($20.5 million) in total proceeds through a strategic investment from La Mancha Resource Fund and a concurrent bought deal financing.
La Mancha has agreed to invest C$12.7 million via a non-brokered private placement of 30.9 million shares at C$0.41 per share, giving the fund a 19.9% stake in Miata upon closing.
Concurrently, Miata has entered a bought deal agreement with ATB Cormark Capital Markets and SCP Resource Finance for 18.3 million shares at the same price, raising C$7.5 million.
The underwriters hold a 15% over-allotment option exercisable for 30 days following closing.
The transactions are expected to close on or about 18 August, with each closing conditional upon the other.
CEO Jacob Verbaas says the company is pleased to welcome La Mancha as a strategic investor.
“The La Mancha group brings extensive technical, mine-development and capital-markets experience that will complement the capabilities of our management and technical teams as we continue advancing Sela Creek,” Verbaas says.
La Mancha will receive customary investor rights under an agreement requiring the fund to maintain at least 10% ownership.
The fund has agreed to an 18-month lock-up period and a two-year standstill preventing it from acquiring more than 25% of outstanding shares.
Jack Lunnon, chief technical officer at La Mancha Resource Capital, says the investment reflects the fund’s belief that Suriname ‘represents an under-explored jurisdiction for gold discovery’.
“Since gaining access to Sela Creek, Jaap and the Miata team have, in our view, demonstrated their ability to operate effectively in this remote jurisdiction, as reflected in the drilling results delivered to date,” Lunnon says.
Miata Metals will use proceeds to fund exploration and drilling at the Sela Creek Gold Project, support technical studies and project development activities, and for general corporate purposes.
Write to JC Villarba at Mining.com.au
Images: Mining.com.au
