Abitibi Metals Corp. [CSE-AMQ, OTC-AMQFF, FSE-4KG), a company previously known as Goldseek Resources Inc., on Monday announced details of a $3 million non-brokered private placement financing with lead orders from Vancouver financier Frank Giustra, Greg Charmandy and other strategic investors.
The private placement is expected to consist of up to 10 million common shares priced at 30 cents each.
Abitibi shares advanced on the news, rising 6.8% or $0.025 to 39 cents. The shares trade in a 52-week range of 55 cents and $0.03.
“We are thrilled to announce a strategic investment from Mr. Frank Giustra, a distinguished financier and mining entrepreneur,’’ said Abitibi Metals CEO Jonathon Deluce. “Mr. Giustra is known globally for his unparalleled success as he has helped foster the growth of some of the world’s most successful mining companies.’’
Deluce said the financing is also backed by a strategic investment from Greg Charmandy. The Abitibi CEO described him as “an exceptionally accomplished serial entrepreneur with a diverse background spanning multiple industries. “Mr. Charmandy, who co-founded Gildan Activewear, also served as the Executive Chairman of Richmond Mines Inc., a company that was acquired by Alamos Gold Inc. [TSX-AGI, NYSE] for $933 million. He also served as Chairman of Cornerstone Capital Resource Group, which was acquired by Solgold [TSX-SOLG, LSE].
Abitibi said private placement proceeds are earmarked for drilling at the high grade B26 Polymetallic copper deposit and Beschefer Gold Project. Both are located just 7.0 kilometres apart within the Abitibi Greenstone Belt in Quebec.
“This capital will mark a significant step towards realizing our aggressive growth plans for 2023,’’ Deluce said. “We now plan to conduct a larger first quarter drill program at B26 with a strong focus on advancing and expanding the high-grade resource.’’
The B26 Polymetallic Copper Deposit hosts an indicated resource of 7.0 million tonnes of grade 2.94% Copper Equivalent (CuEq), plus an inferred resource of 4.4 million tonnes of 2.97% CuEq. At the Beschefer Gold Project, historical drilling has identified four historic intercepts with a metal factor of over 100 g/t gold, highlighted by 55.63 g/t gold over 5.57 metres and 13.07 g/t gold over 8.75 metres amongst four modelled zones.
The Beschefer Project is located 30 kilometres southwest of Wallbridge Mining Co. Ltd.’s [TSX-WM, WC7-FWB] 100%-owned Fenelon gold property and has been described as Goldseek’s flagship project going forward.
Under an agreement with Wallbridge, Abitibi can earn a 100% interest in the project, after agreeding to exercise the 4.0-year option by delivering on $3 million worth of work commitments and issuing 4.0 million shares.
The Beschefer Project covers approximately 962 acres and is located in the Northern Abitibi Greenstone Belt, 14 kilometres east of the past-producing polymetallic Selbaie Mine, 45 kilometres northeast of the Casa Berardi Mine and 30 kilometres from Wallbridge’s Fenelon Gold property.
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