Soma Gold (TSX-V:SOMA) is raising up to C$15 million ($16.75 million) as a base offering in its non-brokered private placement as the company progresses its mill expansion at El Limon in Colombia.
ECM Capital Advisors and Greenwood Capital Partners are acting as financial advisor and as finders in relation to the offering.
The placement is offering up to 13.04 million units at C$1.15, with each unit comprising one share and one-half of a purchase warrant.
Holders will be entitled to purchase another share at C$2 per share for 36 months from the issue date with each warrant.
Soma will engage an accelerated exercise provision that will cost warrants to expire if its trading price exceeds C$3 for 30 days, to expire 30 days after this period.
The first tranche is expected to close by 8 August, with the entire placement to close by 15 August 2025.
The company will also have the opportunity to upsize to raise C$17.25 million for a greenshoe option, representing a 15% increase to the original placement.
In conjunction with this placement, Soma intends to convert around C$10 million of debt into units for Conex Services, following the same terms as the placement. Conex Services is an insider-controlled company and Soma’s senior lender.
Funding will be used to support the company’s ongoing expansion to the El Limon mill, which will add an additional 40% of tons capacity, as reported by Mining.com.au.
The company will also place funds towards installation of an ore sorting infrastructure, exploration costs, and the development of the Nechi mine, also located in Colombia.
CEO Geoff Hampson says previous exploration has confirmed Soma’s potential to boost resources across its projects.
“Our organic growth strategy focuses on increasing both resources and feed material, followed by phased increases in gold production through ore-sorting and mill capacity upgrades,” Hampson says.
“With additional capital, we can accelerate this plan, enabling us to achieve our production targets sooner and at a lower long-term cost.”
Write to Maddison Elliott at Mining.com.au
Images: Soma Gold
