Sprott, McEwen, Crescat back Kirkland Lake financing
Kirkland Lake Discoveries Corp. [KLDC-TSXV] has upsized a previously announced non-brokered private placement financing, which is now expected to raise up to $10 million. That’s ahead of the previous target of $7.0 million.
The announcement comes after Kirkland Lake said it had secured lead orders from new and existing investors, including Eric Sprott, Rob McEwen and Crescat Capital for $6.0 million.
The offering will now consist of the issuance of (i) flow through shares priced at 30 cents per FT share, and (ii) units priced at 25 cents per unit in any combination.
Each unit will consist of one common share and one half of one common share purchase warrant. Each whole warrant can be exercised to acquire one additional common share at an exercise price of 40 cents for 36 months from the date of issuance. The FT shares issued under the offering are intended to qualify as “flow-through shares” within the meaning of the if the Income Tax Act (Canada).
Net proceeds will be used to fund exploration activities at the company’s projects and for working capital purposes. The gross proceeds from the FT shares will be used to incur Canadian exploration expenses that are intended to qualify as “flow-through mining expenditures” as those terms are defined in the Tax Act.
On Friday, Kirkland Lake shares rose 1.7% or $0.005 to 30.5 cents. The shares trade in a 52-week range of 35 cents and $0.025.
Kirkland Lake Discoveries has consolidated a district-scale and prospective land package in the Kirkland Lake gold camp. The assembled properties include the 100%-owned Lucky Strike property, Goodfish-Kirana, the Arnold property, the optioned KL West and KL Central. The company’s land position covers approximately 38,000 hectares over 1,338 claims and 29 patented claims in the Kirkland Lake region. The Lucky Strike property is located immediately east of the land package and consists of 653 unpatented mining claims covering 11,367 hectares.
Kirkland Lake recently said it has intersected a polymetallic mineral system in its first drill hole, KLD25-28 at the Winnie showing at its Kirkland Lake West property. The company said this drilling confirms the system is intrusion-related, unlocking 17 kilometres of highly prospective intrusion contact potential, with geophysics and geochemistry pointing to the most promising targets. The company is planning more drilling at the Winnie showing.
Back in February 22, 2023, Kirkland Lake closed an asset purchase agreement with New Found Gold Corp. [NFG-TSXV] related to the Lucky Strike property.
Under an agreement, Kirkland Lake issued 28.6 million common shares to New Found as well as a 1.0% net smelter return royalty on the Lucky Strike property. The Kirkland Lake share issued to New Found were worth $5.7 million. That left New Found holding 49% of the issued and outstanding Kirkland shares.
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