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i-80 Gold Corp. (TSX: IAU) announced Tuesday the signing of definitive agreements on a financing package for aggregate proceeds of $135 million, plus an accordion option to potentially access an additional $100 million.
The finance package includes $60 million in convertible loans with OMF Fund III (F) Ltd., an affiliate of Orion Mine Finance ($50 million), and funds managed by Sprott Asset Management USA and CNL Strategic Asset Management ($10 million). The loans have been fully funded and issued.
The package also consists of a gold prepay purchase agreement and a silver purchase agreement with affiliates of Orion totaling $75 million ($45 million for gold, $30 million for silver). Each agreement contains an accordion feature to potentially to access up to an additional $50 million at i-80’s option.
According to i-80, the financing package, when combined with its recent equity financing, will place the company in a “robust financial position to proceed with the aggressive advancement of its substantial asset portfolio.”
Following completion of this financing, the Nevada-focused gold miner expects to have approximately $200 million in its treasury.
“The financing package will position i-80 to aggressively pursue the development of the company’s portfolio of advanced-stage deposits, all located in Nevada, one of the world’s most favorable mining jurisdictions”, Ryan Snow, chief financial officer of i-80, said in a news release.
“With multi-million ounce gold and silver resources, and our enviable treasury position, we now pursue our objective to be one of the mining industry’s fastest growing producers,” Snow said.
Earlier this year, the company closed a transaction to acquire the Lone Tree and Buffalo Mountain gold deposits from Nevada Gold Mines, including certain processing infrastructure, that is expected to become the hub of i-80’s Nevada property portfolio.
The company also acquired from the producing Ruby Hill mine, which includes multiple deposits that collectively represent one of Nevada’s largest gold, silver and base metal endowments.
When combined with existing assets Granite Creek and McCoy-Cove, i-80 believes it is now positioned to begin executing on its plan to build a prominent, standalone, multi-asset gold producer.
“Our primary target is to quickly grow our production profile to create a Nevada-focused mid-tier gold producer and achieve our goal of becoming one of the largest producers in the state,” said CEO Ewan Downie.
“As one of only three companies in Nevada with infrastructure to process refractory mineral resources, i-80 has gained a strategic advantage for long-term mine development.”
i-80 is proceeding with its plan to build a minimum of four new mining operations at its Ruby Hill, Granite Creek, Buffalo Mountain and McCoy-Cove properties over the next three years, with mineralization from all sites ultimately being processed at Lone Tree.
Shares of i-80 Gold rose 4.4% by 12:20 p.m. ET on the latest financing news. The company’s market capitalization stands at C$541.7 million.
