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Toronto-based Generation Mining (CSE: GENM) announced on Wednesday it has arranged a bought deal private placement with a group of underwriters, offering approximately 15.38 million units of the company at C$0.52 per unit to raise total proceeds of C$8 million.
Each unit comprises one common share in the capital of Generation Mining and one-half of one common share purchase warrant. Each full warrant shall be exercisable to acquire one common share at a price of C$0.75 for a period of 24 months from the placement closing date.
Net proceeds from the offering will be used for exploration and development activities at the company’s Marathon palladium project in Ontario
Canadian investor Eric Sprott has agreed to purchase C$5 million of the offered units. Upon completion of the offering, Sprott would own approximately 8.84% of Generation Mining on a non-diluted basis and 12.70% on a partially diluted basis.
Net proceeds from the offering will be used for exploration and development activities at the company’s Marathon palladium project in Ontario.
The property — located 215 km east of Thunder Bay and 10 km north of Marathon — was developed from 1985 to 2010 by various companies and was eventually owned by Marathon PGM Corporation. The property was later acquired by Sibanye-Stillwater. Generation Mining currently holds a 51% interest in the project.
Shares of Generation Mining rose by more than 12% midday Wednesday, at one point reaching an all-time high of C$0.74 a share. The company’s market capitalization is approximately C$65 million.
