Both聽Montage Gold聽(TSXV: MAU) and the have made strategic investments in Sanu Gold (CSE: SANU) with a combined value of over C$10 million to support the Canadian junior miner鈥檚 exploration activities in Guinea.
Under a binding agreement signed Dec. 1, Montage would issue approximately 2.33 million shares priced at C$2.35 each (totalling about C$5.5 million) in exchange for an equivalent value of Sanu shares priced at C$0.072 per share. Upon closing, Montage would become a 19.99% shareholder in Sanu, with approximately 76.3 million shares held.
Separately, the Lundin family and its associates would purchase roughly C$4.5 million of Sanu shares, also priced at C$0.072 each, through a private placement. This would make Lundin a 10% shareholder in Sanu upon closing.
Following the investment announcement, Sanu Gold鈥檚 stock doubled from last week鈥檚 closing price of C$0.05 to C$0.10 on Monday morning, for a market capitalization of C$27.5 million ($19.5m).
Montage and Lundin now join AngloGold Ashanti (JSE: ANG) (NYSE: AU) and Capital DI Ltd. as Sanu鈥檚 key shareholders. In September, AngloGold and Capital DI each obtained a 14% and a 10% stake, respectively, through the participation of a C$5 million private placement.
Guinea exploration
The proceeds of the new investments will be used to advance geophysics and drilling聽on Sanu鈥檚 three exploration permits (Daina, Diguifara and Bantabaye) within the Siguiri Basin of Guinea, a world-class gold district hosting several producing mines and major discoveries such as AngloGold鈥檚 Siguiri and Nordgold鈥檚聽Lefa.
To date, the company has defined gold-bearing structures (nearly 20 km of combined strike length) on each of its gold exploration permits, with multiple high-value drill targets identified aiming to make the next multi-million-ounce discovery.
In addition, Martino De Ciccio,聽CEO of Montage, is expected to be appointed chairman of Sanu Gold鈥檚 board, while Silvia Bottero, its EVP of exploration, will join the new joint-technical committee at Sanu to help advance these projects.
In a press release Monday, De Ciccio said the partnership with Sanu 鈥渨ill allow Montage to leverage Sanu鈥檚 established presence in Guinea to accelerate its greenfield exploration strategy.鈥�
鈥淭he Montage leadership is comprised of seasoned West African gold professionals, and this further highlights the potential of Sanu鈥檚 projects in Guinea,鈥� Sanu Gold CEO Martin Pawlitschek added.