McEwen Mining Announces $70M Private Placement

Mcewen Mining Inc. has announced a non-brokered private placement financing of up to 2,333,333 common shares of its wholly-owned subsidiary Mcewen Copper Inc. at a subscription price of US$30.00 per common share, for gross proceeds of up to US$70 million.

Lead orders to purchase 27% of the total offering have been committed by Mcewen Mining and Rob McEwen. Mcewen Mining will purchase up to 466,667 common shares of Mcewen Copper for US$14 million, and Rob McEwen will purchase up to 166,666 common shares for US$5 million.

Before the offering, ownership in Mcewen Copper was 47.7% for Mcewen Mining and 12.9% for Rob McEwen. Assuming completion of the full amount of the offering and the investment amounts shown above, Mcewen Mining will own 45.8% of Mcewen Copper, and Rob McEwen will own 12.5%.

The financing will be used to advance work on a bankable feasibility study for the Los Azules copper project, which is scheduled for publication by the end of the first quarter (Q1) of 2025.

The Los Azules project is ranked the 8th largest undeveloped copper deposit in the world, with current copper resources of 10.9 billion pounds at a grade of 0.40% Cu (indicated category) and an additional 26.7 billion pounds at a grade of 0.31% Cu (inferred category) as of the June 2023 preliminary economic assessment (PEA). The PEA estimates a $2.7 billion after-tax NPV8% at $3.75/lb Cu, a low average C1 production cost of $1.07/lb Cu, a 3.2-year payback period, and a 27-year mine life.

A bankable feasibility study (FS) is underway with completion planned by the end of Q1 2025. Los Azules is being designed to consume significantly less water, emit much lower carbon, progress towards carbon neutrality by 2038, and be powered by 100% renewable electricity once in operation. Today the company's shares have moved -1.3% to a price of $9.14. Check out the company's full 8-K submission here.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.