24.7 C
Mining News

Eldorado Gold Announces C$81.5 Million Strategic Investment by the European Bank for Reconstruction and Development (EBRD) and Concurrent C$135 Million Bought Deal Financing

Eldorado Gold Corporation announced it has entered into agreements with respect to a C$81.5 million strategic investment in Eldorado by the European Bank for Reconstruction and Development (the “EBRD”). The investment is to be effected by way of a private placement whereby the EBRD will subscribe for 6,269,231 shares at a price of C$13.00 per share. (the “Private Placement”). The proceeds of the Private Placement will be invested in the Skouries project in Northern Greece, and will be credited against the Company’s 20% equity funding commitment per the terms of the project financing facility that closed on April 5, 2023.

In addition, the Company has entered into an agreement with BMO Capital Markets and National Bank Financial, on behalf of a syndicate of underwriters (collectively, the “Underwriters”), pursuant to which the Underwriters have agreed to purchase on a bought deal basis 10,400,000 Common Shares of the Company at the same price as the EBRD Private Placement of C$13.00 per Common Share, for gross proceeds of C$135 million (the “Offering”).

Supported by

In addition, the Company has granted the Underwriters an over-allotment option to purchase up to an additional 1,560,000 common shares, exercisable, in whole or in part, at any time up to 30 days from the closing of the Offering. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the Offering would be C$155 million. Proceeds from the Offering will be used to fund growth initiatives across the global portfolio, including some not currently contemplated within the Company’s five-year plan, as well as for general corporate and working capital purposes.

“We are pleased to be announcing a strategic equity investment from the EBRD and we view its investment as an endorsement of the Skouries project and Eldorado’s commitment to the highest environmental and social standards across our portfolio,” said George Burns, President and CEO of Eldorado. “The EBRD’s equity investment, coupled with the Greek lenders in our recently closed project finance facility, provides strategic partners as we advance Skouries towards commercial production,” continued Burns.

“Proceeds from this financing will strengthen the Company’s balance sheet and is expected to provide additional optionality across our global portfolio. With a number of exciting development opportunities that are not currently included within our five-year plan, this additional funding provides us financial flexibility to advance these projects, including the Perama Hill project in Northern Greece. Perama Hill is a high-quality project with consultation activities expected to commence later this year and then advance through the EIA process over the next two years.

At Olympias, we received a modified EIA in April that provides us the ability to expand the processing plant following ramp up of development of the underground. In Canada, with a maiden reserve expected next year at our Ormaque discovery, we expect to undertake additional trade-off studies to determine the optimum approach to incorporate it into our plans. Additionally, in Türkiye, we have a number of exciting opportunities, including conversion of inferred resources at Efemçukuru and early-stage exploration targets that have the potential to add to an already robust production profile,” added Burns.

“We are pleased that the EBRD is becoming a shareholder in Eldorado,” said Natalia Lacorzana, Head of Natural Resources at the EBRD. “With this landmark equity transaction, the EBRD, as a long-term investor, will play an important role in ensuring that the Skouries project is developed and operated in line with best environmental and social practices, in particular in relation to stakeholder engagement. Copper is crucial for many applications in today’s economy, and the demand for copper is expected to increase with the global move towards electric vehicles and renewable energy applications, as both of these sectors require large volumes of the metal.”

The Common Shares are being offered for sale pursuant to the Offering in all of the provinces and territories of Canada by way of a Canadian prospectus supplement to the Company’s Canadian short form base shelf prospectus dated May 18, 2023. The Common Shares are being offered for sale in the public offering in the United States pursuant to an effective registration statement (including a prospectus supplement thereto) filed under the U.S. multi-jurisdictional disclosure system.

Before investing, prospective purchasers in Canada should read the Canadian prospectus supplement, the Canadian short form base shelf prospectus and the documents incorporated by reference therein for the purposes of the public offering, and prospective purchasers in the United States should read the prospectus in the U.S. registration statement, the U.S. prospectus supplement and the documents incorporated by reference therein for more complete information about the Company and the public offering in Canada and the United States. Common Shares may also be offered on a private placement basis in other international jurisdictions in reliance on applicable private placement exemptions.

The Offering is expected to close on or about June 7, 2023 and is subject to a number of customary closing conditions, including the approval of the Toronto Stock Exchange and New York Stock Exchange. The closing of the Offering is not conditional on the closing of the Private Placement.

The Private Placement is expected to close on or about June 13, 2023 following completion of the Offering, and is not conditional on the closing of the Offering. The Private Placement is also subject to a number of customary conditions, including the approval of the Toronto Stock Exchange and New York Stock Exchange. In addition, and as part of the Private Placement, the Company and EBRD have entered into a Project Support Agreement, pursuant to which, amongst other things, the Company has agreed to provide EBRD with certain ongoing reporting rights regarding the development and operations of the Skouries Project, as well as customary anti-dilution rights with respect to its investment in the Company. All securities issued under the Private Placement will be subject to a hold period expiring four months and one day from the date of issuance.

About Eldorado Gold

Eldorado is a gold and base metals producer with mining, development and exploration operations in Turkiye, Canada and Greece. The Company has a highly skilled and dedicated workforce, safe and responsible operations, a portfolio of high-quality assets, and long-term partnerships with local communities. Eldorado’s common shares trade on the Toronto Stock Exchange (TSX: ELD) and the New York Stock Exchange (NYSE: EGO).

About EBRD

The European Bank for Reconstruction and Development was established in 1991 to help build a new, post-Cold War era in Central and Eastern Europe. It has since played a historic role and gained unique expertise in fostering change in the region – and beyond – investing €170 billion in more than 6,400 projects. The EBRD is committed to furthering progress towards ‘market-oriented economies and the promotion of private and entrepreneurial initiative’.


Source: Eldorado Gold

Related posts

Bridging environmental concerns: Serbia’s lithium extraction dilemma

David Lazarevic

Lithium mining divides Portugal’s rural communities

David Lazarevic

Lundin Mining adopts sustainability-linked loan structure to enhance environmental and social impact

David Lazarevic
error: Content is protected !!