Gold producer Kirkland Lake Gold has increased its stake in fellow Canadian precious metals exploration company Osisko Mining by acquiring additional shares in the company through private placement financing.
Under the placement, Kirkland acquired 14,705,882 common shares of Osisko at C$1.70 per share for a total consideration of around C$25m ($19.21m).
With the investment, the company has increased its interest from the existing 8.58% to 13.61%, while its shareholding in Osisko now stands at 32,627,632 shares.
Kirkland Lake Gold president and CEO Tony Makuch said: “Our strategic investment in Osisko increases our ownership interest in the Urban Barry area of northwestern Quebec, which we believe has become a new, highly-prospective mining camp in the prolific Abitibi-Greenstone belt.
“The investment is complementary to our existing interests in Metanor Resources and Bonterra Resources, both of which have high-potential exploration holdings in the same area.
“In addition, through the investment in Osisko, we gain exposure to attractive, early-stage exploration properties in close proximity to our Holt and Taylor mines, providing additional value potential around our existing asset base in Ontario.”
The company acquired the shares for investment purposes and noted that it would either acquire additional securities or sell them depending on market conditions.
This year, the firm aims to achieve more than 635,000 ounces of gold production from mines in Canada and Australia.
Meanwhile, Osisko closed $76.4m ‘bought deal’ private placement of flow through shares and common shares in a round led by Canaccord Genuity on behalf of a syndicate of underwriters.
In March this year, Osisko signed an option agreement over its Urban-Barry base metals project with Osisko Metals.
Under this agreement, Osisko Metals has an option to earn a 50% interest in the project by meeting certain conditions.