Mawson Resources gets shareholder approval for second tranche of financing, to hold over $8 mln in cash

Mawson Resources (TSE:MAW) says that its shareholders have approved the second tranche of its financing, with the company to hold over C$8 million in cash after the deal closes. 

Under the second tranche, Sentient Global Resources Fund IV, part of a group of funds which is an insider of Mawson, will subscribe for an additional 3.63 million units for total proceeds of $1.6 million. The company closed a $2.57 million first tranche in early August, which was oversubscribed.  

The approval by the company's "disinterested shareholders" --  that is, shareholders other than Sentient group and those involved in the first tranche --- was given at a special meeting of shareholders held on August 30, Mawson said. The Sentient group currently holds about 27.4 per cent of Mawson on a non-diluted basis, and after the second tranche -- which is expected to close shortly -- it will hold almost 30 per cent of the company. 

"We thank our shareholders for the overwhelming endorsement of the Second Tranche," said president and CEO Michael Hudson in a statement Tuesday. 

"Upon closing of the Second Tranche, Mawson will hold over C$8M in cash. This will ensure we can continue to build our business in the Nordic countries around Rompas, maintain our exploration momentum and focus, by continuing to control overheads and investing shareholder capital in the ground."

Indeed, the new funds will be used to advance exploration at Mawson's Rompas project in Finland, as well as for general working capital needs. 

In June, Mawson said it discovered a new gold prospect, named Kaita, in the first month of field work at its Rompas project. The Kaita prospect, it said, is located just 900 metres from the South Rompas drill area, and is made up of 26 surface mineralized sites, of which 11 have visible gold, discovered over a zone striking 415 metres. 

Mawson's plan is to maintain its momentum in the exploration program so far, with a company-wide budget of $2.5 million planned for this year.

The new Kaita discovery, which Mawson plans to prioritize to define drill targets over the coming months, is located outside the Natura 2000 biodiversity areas, and has been confirmed by a biologist to contain "low value forest and no significant plant species".