VANCOUVER (miningweekly.com) – Americas-focused miner Yamana Gold raised about C$80-million through a secondary offering of common shares of its subsidiary Brio Gold.
The companies have entered an agreement with a syndicate of underwriters co-led by Canaccord Genuity, CIBC Capital Markets and National Bank Financial under which the underwriters have agreed to buy 26.67 common shares of Brio, currently held by Yamana, on a bought deal basis, at an offering price of C$3 per Brio share.
The underwriters have a 30-day overallotment option that could result in a further 2.67-million shares being sold, pushing the total gross proceeds to Yamana to C$88-million.
Before the offering, Yamana owned about 79.3% of the issued and outstanding common shares of Brio on a basic basis and 75.3% on a fully diluted basis. After giving effect to this offering, and assuming the full exercise of the overallotment offering, Yamana will own 53.2% of the issued and outstanding common shares of Brio Gold on a basic basis and 50.5% on a fully diluted basis.
Yamana had in December completed the spin-out of Brio, forming a standalone public company focused on a portfolio of noncore Yamana assets in Latin America and Canada.
Yamana advised that Brio will not receive any proceeds from the offering and all the expenses of the offering will be paid by Yamana.
“We are pleased to announce this sale of Brio shares which is consistent with the plan we have implemented to realise value from our Brio holdings. The sale of over 26-million shares of Brio reduces our investment significantly and is expected to meaningfully increase liquidity for the shares. The proceeds from the sale advance our stated goals of increasing our cash balances and decreasing our net debt. Further, we believe that reducing our interest in Brio and creating liquidity will lead to additional opportunities with our remaining holdings in Brio,” Yamana chairperson and CEO Peter Marrone stated.
Closing of the offering is expected to occur on or about June 1, and is subject to certain conditions, including the approval of Canadian securities regulatory authorities.