Macfarlane Lake Mining Company Limited (MLM-CSE, MLMLF(OTC, W2Z-FRA) Shares rose strongly Thursday after the company announced details of a $6.75 million non-brokerage private placement financing led by strategic investors Michael Gentile and Pierre Beaudoin.
Shares jumped 17.24, or $0.025, to 17 cents, and traded in a 52-week range of 17.5 cents and 0.025.
Gentile, a well-known mining investor, has agreed to subscribe for up to $6.35 million of the financing, while Beaudoin has pledged to participate in the remaining balance. Beaudoin is a precious metals mining executive with over 30 years of experience in diverse mining, mineral processing, design, construction and start-up industries.
Under the terms of the offering, investors subscribe for units at a price of 12 cents per unit. Each unit will consist of one common share and one common share purchase warrant. Each warrant entitles the holder to acquire an additional common share for 16 cents for a period of 36 months from the date of issuance.
Upon closing, Gentile is expected to retain approximately 19.67% of the Company’s issued and outstanding shares on a partially diluted basis (assuming exercise of the warrants).
McFarlane Lake is a Canadian gold exploration company with a focus on developing its flagship Juby Gold Project, located near Gowganda, Ontario, within the established Abitibi Greenstone Belt. The project hosts an estimated NI 43-101 compliant mineral resource of 1.01 million ounces of gold in the indicated category with an average grade of 0.98 g/t gold (31.74 million tons) and an additional 3.17 million ounces of gold in the inferred category, with an average grade of 0.89 g/t gold (109.48 million tons). The estimate was calculated using a long-term gold price of US$2,500 per ounce, applying a cut grade of 0.25 g/t gold for open pit and 1.85 g/t gold for underground resources.
The sensitivity analysis was completed at a higher gold price of US$3,750 per ounce, resulting in an inferred resource of 1.20 million ounces grading 0.94 g/t gold (39.51 million tons) and an inferred resource of 4.23 million ounces grading 0.85 g/t gold (154.40 million tons) applying cut grades of 0.25 g/t open pit and 1.15 g/t gold. for underground resources.
The proceeds from the offering may be used to repay a portion of the Company’s outstanding bonds, to advance the Company’s exploration and development at Lake Gobi, and for general working capital.
Gentile said: “I am excited to make this significant investment in Lake Macfarlane and support the progress of the Gobi Lake project. Lake Macfarlane meets all the requirements I look for in a mining project: scale, size, infrastructure, grade and compelling exploration, all in a proven Tier 1 jurisdiction and trading at a market cap of just $60 million.” “I look forward to working closely with management to enhance these assets and create long-term value for shareholders.”
