VANCOUVER – Cassiar Gold Corp. [GLDC-TSXV, CGLCF-OTCQX] has upsized a previously announced bought deal financing to $9.5 million from the original $7.5 million target. The company said it intends to use the net proceeds for the exploration of its Cassiar gold property in British Columbia.
The shares declined on the news, easing 13.8% or $0.08 to 50 cents on volume of 845,410. The shares are currently trading in a 52-week range of $1.28 and 46 cents.
The underwriters have agreed to purchase 12.7 million flow-through units on a bought deal basis to be sold to charitable purchasers for 75 cents per unit, generating gross proceeds of $9.5 million. Concurrently with the offering, the company intends to complete a non-brokered private placement of traditional flow-through units at 75 cents for proceeds of up to $500,000.
Each charity flow-through unit consists of one common share and one-half of one common share purchase warrant. Each whole warrant will entitle the holder to purchase one non-flow-through share of the company for 70 cents at any time prior to the date which is 24 months after the closing date of the offering.
The company has granted the underwriters an option to purchase up to an additional 1.9 million Charity flow-through units for resale to charitable purchasers at the offering price, potentially raising additional gross proceeds of $1.43 million to cover any over-allotments. That option remains open for 30 days after and including the date of closing
Cassiar is a British Columbia-focused exploration company. It holds a 100% interest in its flagship Cassiar gold project, which spans 590 square kilometres and consists of two main project areas known as Cassiar North and Cassiar South.
Cassiar North holds a NI-43-101-compliant inferred resource estimate of 1.4 million ounces, grading 1.14 g/t (cutoff grade 0.7 g/t) and known as the Taurus Deposit.
Cassiar South hosts numerous gold showings, historical workings and exploration projects over a 15-kilometre long and up to 10-kilometre-wide trend. Historical underground mines in the Cassiar South area have yielded over 315,000 ounces of gold at grades of between 10 and 25 g/t gold, underscoring the high potential for further discovery of bonanza-grade orogenic gold veins.
The area is accessible via Highway 37, which bisects the property, and access roads throughout the property. The project has a 300 tonne-per-day mill for future operations and a permanent camp.
The company also holds a 100% interest in the Sheep Creek gold camp in Salmo, B.C. The Sheep Creek gold district ranks as the third largest past producing orogenic gold district in B.C, with historical production of 742,000 ounces of gold at an average grade of 14.7 g/t gold from 1900 to 1951. Minimal exploration work has been conducted since the 1950s, Cassiar said in a press release.