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Monday, 29 April 2013
Treasury Metals raises $1.17 mln for Goliath in first tranche; next tranche to close this week
Treasury Metals (TSE:TML) has wrapped up the first tranche of a non-brokered private placement financing, raising $1.17 million so far, with the next tranche expected to close early this week.
The company told investors late Friday that the first placement consisted of 2.6 million units at a price of 45 cents each. The second tranche of the offering, made up of 1.2 million flow-through shares at a price of 50 cents apiece, is expected to close on Tuesday.
Total proceeds from both tranches are expected to come in at $1.77 million.
Each unit is made up of one common share and one half of a share purchase warrant, which can be used for a period of three years from the closing date. Each whole warrant is good for one additional common share of the company at 75 cents each.
The company said Friday the new funds would be used for the advancement of its Goliath gold project, including the completion of an environmental impact statement, and for general working capital needs.
The offering, Treasury said, was primarily sold to investors in Canada and Europe.
Treasury is advancing its 1.7 million gold equivalent-ounce Goliath gold project near Dryden in northwestern Ontario. The project boasts near-term production potential, with Treasury forecasting production start-up in late 2015, with average annual life-of-mine output of around 80,000 gold equivalent ounces at cash costs of $698 an ounce.
Broker Casimir Capital recently started initial coverage on the company with a speculative buy recommendation and a target price of C$1.25 per share - way up from its current trading price of 41.5 cents, suggesting plenty of upside potential.
"Amid a wave of capex blowouts, the scaling back of numerous projects, increasingly activist local protests in some jurisdictions, plans for increased government royalties and windfall taxes, and even outright nationalizations, we highlight Treasury Metals Inc," the analyst wrote in a morning research note in early April.