Mexico’s proposed higher mining royalties could block nearly $7bn in investments
The Mexican government proposed raising mining royalties under the argument that metal prices have risen in recent years.
Founders Metals’ (TSXV: FDR) shares rose on Thursday following the announcement of a C$15 million private placement financing along with an investment by a mystery precious metals producer.
Under the financing agreement, a syndicate of underwriters led by BMO Capital Markets will buy 6.25 million shares of Founders on a bought-deal basis at a price of C$2.40 each. The stock traded at C$2.52 at market open, and by 11 a.m. ET, had risen 6.1% to C$2.60 with a market capitalization of C$192.1 million ($139.5m).
In addition to the private placement, the company said it has agreed to terms with an unnamed major precious metals producer for a 5% equity investment. Details of this transaction will be announced later, it added.
This investment, combined with C$15 million in proceeds from the private placement, will be used for Founders’ exploration activities at its Antino gold project in Suriname, which is currently in the resource definition stage and is permitted for drilling and mining.
The company entered the project in 2022, and has since completed 10,000 metres of drilling in 2023 and is undertaking another 30,000-metre program this year. The aim is to have a first resource estimate published sometime in 2025.
The Antino project covers 238 sq. km within the Guiana Shield, including a significant area of alluvial and small-scale open pit gold mining with an estimated 500,000 oz. of reported production to date.
