Canadian company Iamgold has announced a bought deal to divest 72 million common shares at $4.17 each, aiming to raise around $300m (C$409.59m).
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For this capital raise, the company reached an agreement with a syndicate of underwriters led by National Bank Financial Markets, BMO Capital Markets and RBC Capital Markets.
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This move is part of the company’s strategy to repurchase a 9.7% interest in the Côté Gold Mine from Sumitomo Metal Mining, aiming to regain its full 70% stake in the mine.
The underwriters have also been granted an option, exercisable within 30 days post-closing, to acquire up to a further 10.8 million shares at the offering price to manage over-allotments.
Should this option be fully exercised, IAMGOLD’s gross proceeds from the offering could reach nearly $345m.
The net proceeds from the offering are earmarked for the repurchase of the 9.7% interest in the Côté Gold Mine, which IAMGOLD operates through a joint venture (JV) with Sumitomo.
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By GlobalDataCurrently, IAMGOLD holds a 60.3% interest in the JV and had previously announced the option to buy back the 9.7% stake on 19 December 2022.
By reacquiring the 9.7% stake, IAMGOLD will not only restore its 70% interest in the Côté Gold Mine but also enhance its exposure to the mine’s economic benefits and cash flows.
Additionally, the repurchase will eliminate the costs associated with maintaining the option to buy back the interest.
The share offering is expected to close around 24 May 2024, subject to the fulfilment of certain conditions including necessary approvals from the Toronto Stock Exchange and the New York Stock Exchange.
