The SolGold plc (LON: SOLG) share price plunged 5.98% after revealing that it had completed the $36 million capital raise announced on 23 November 2022.
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Two institutional investors, Jiangxi Copper (Hong Kong) Investment Company Limited and Maxit Capital LP, participated in the share issue, which raised US$36,000,000.
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Jiangxi Copper subscribed to 155 million shares priced at $0.20 each, while Maxit Capital subscribed to 23 million shares bringing the total number of shares issued to 188 million.
Investors’ adverse reaction was primarily driven by the significant dilution of existing shareholders, given that the company is now worth £397.4 million.
Scott Caldwell, SolGold’s Interim CEO, commented: “We are very pleased to welcome Jiangxi as an investor and partner in SolGold. Jiangxi Copper Company Limited, the parent company of Jiangxi, is one of the largest global producers of refined copper. Their presence is another strategic endorsement for SolGold, the world-class Cascabel project and Ecuador as an emerging mining jurisdiction and will be of great benefit to Ecuadorians and SolGold shareholders.”
December has been a busy month for SolGold after the company started with the completion of the previously announced US$50 million royalty financing under the Royalty Financing Agreement with Osisko Gold Royalties Ltd regarding the Company’s Cascabel copper-gold project in northern Ecuador.
The royalty financing significantly boosted SoldGold’s finances and the Cascabel copper-gold project. In addition, the company lauded the support it received from Osiko Gold, saying that it now provides it with multiple options in progressing the project towards production.
The company’s Cascabel project has attracted many partners, demonstrating its importance as a world-class resource, and many can’t wait for the production activities to start.
SolGold shares have fallen 39.16% this year but might have formed a bottoming pattern since early October. The shares are now trading sideways and could surge higher any time now.
*This is not investment advice.
SolGold share price.
The SolGold share price plunged 5.98% to trade at 17.28p, falling from Friday’s closing price of 18.38p.
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