Guanajuato Silver Company (TSXV: GSVR) announced on Tuesday that it has arranged a private placement of approximately 33.3 million units priced at C$0.24 each for proceeds of C$8 million. Anchoring the financing is Canadian mining billionaire Eric Sprott, who will purchase C$3 million of the units.
Shares of Guanajuato Silver gained 0.9% at C$0.28 apiece following the Sprott investment. This gives the Mexico-focused precious metals miner a market capitalization of approximately C$111 million ($80.2m).
“We are extremely pleased to welcome the participation of Eric Sprott in this financing. His continued support is a strong endorsement of Guanajuato Silver’s vision and potential,” CEO James Anderson said in a news release.
He added that this financing will provide the company with necessary capital to accelerate production in response to rapidly rising silver prices. Earlier this week, the price of silver surged to its highest in 12 years, topping $34 an ounce.
Guanajuato Silver currently operates four mines: El Cubo, Valenciana mines complex and San Ignacio mine in Guanajuato, and the Topia mine in northwestern Durango. Last year, the company saw its highest ever production in silver-equivalent terms at 3.5 million ounces, a 64% increase over 2022.
Due to rising precious metals prices, the miner is coming off its best revenue-generating quarter, recording $20.5 million for the second quarter, a 22% improvement over the same period of 2023.
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