Galantas Gold to raise $85m to fund work at Indiana, Andacollo

(Sharecast News) - Galantas Gold said on Monday that it intended to raise up to $85m through a brokered private placement to fund exploration and development work on its Chilean gold and copper assets.

The AIM-traded company said the placing would comprise up to 154,546,000 units priced at $0.55 each, on a best-efforts agency basis, with Canaccord Genuity acting as sole bookrunner and lead agent.

Each unit would consist of one common share and one-half of one share purchase warrant. Each whole warrant would entitle the holder to buy one Galantas share at $0.80 for 24 months from closing.

Galantas said the shares and warrants issued under the offering would be subject to a Canadian statutory hold period of four months and one day.

After that period, the company would be able to accelerate the expiry of the warrants if its TSX Venture Exchange share price closed above $1.00 for 10 consecutive trading days.

The company said Canaccord had also been granted an option to sell up to 27,273,000 additional units at the same issue price, which would raise up to a further $15m in gross proceeds.

Net proceeds would be used to fund exploration and development work at the Indiana gold and copper project and the Andacollo gold project in Chile, as well as for general corporate and working capital purposes.

Galantas said closing was expected on 28 May, subject to TSX Venture Exchange approval and customary closing conditions.

Certain company insiders were expected to participate in the offering, which would constitute a related-party transaction under Canadian rules.

Galantas said it intended to rely on available exemptions from formal valuation and minority shareholder approval requirements, as the value of insider participation was not expected to exceed 25% of its market capitalisation.

At 1303 BST, shares in Galantas Gold Corporation were down 4.35% at 33p.

Reporting by Josh White for Sharecast.com.

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