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Discovery Metals issues shares to raise C$35m for Mexico projects

27th July 2020

By: Donna Slater

Features Deputy Editor and Chief Photographer

     

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TSX-listed Canadian exploration and development company Discovery Metals Corporation has arranged a nonbrokered institutional private placement to raise C$35-million through the issuance of 25.93-million units, at a price of C$1.35 apiece.

Each unit comprises one common share of Discovery and one half of one common share purchase warrant, with each full warrant exercisable at C$1.75 for a period of two years after the date of issuance.

The proceeds of the private placement will be used primarily to fund Discovery’s continuing exploration programme at its 100%-owned, 35 000 ha Cordero silver project and its Coahuila projects, both in Mexico.

A portion of the proceeds will be used for general working capital and business development purposes.

Discovery Metals is focused on historic mining districts in Mexico.

Eric Sprott has agreed to invest C$15-million as part of the private placement, taking his holdings in Discovery to 27.1%.

He says Discovery provides unmatched leverage to a rising silver price. “I am very encouraged to see the Discovery team continue to execute on their plans at the Cordero project. I have continually grown my position in the company and it is now one of my largest investments in the silver space.”

Discovery president and CEO Taj Singh says the continued support of its largest shareholders recognises the exceptional exposure Cordero offers to increasing silver prices.

“Recent drill results show that [the] Cordero project is developing all the attributes of a tier one project – grade, scale, significant organic growth opportunities and well located in one of Mexico’s premier mining belts.”

He adds that the current financing, priced at a premium to market, reflects strong institutional demand and will create an industry leading balance sheet with over C$75-million in cash allocated for aggressive exploration, resource expansion and future development.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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