- Eric Sprott has acquired a C$12.5 million stake in Vancouver-based Chesapeake Gold (CKG) as part of a $20 million private placement
- The company issued a total of four million common shares at a price of $5.00 each, 2.5 million of which were purchased by Eric
- A further 1 million common shares were acquired by The Sun Valley Master Gold Fund for a total of $5 million
- The proceeds will be used to fund metallurgical test work at its Metates project in Durango, Mexico
- Chesapeake Gold (CKG) is currently down 6.77 per cent and is trading at $5.92 per share
Canadian billionaire Eric Sprott has acquired a C$12.5 million stake in Chesapeake Gold (CKG) as part of a $20 million private placement.
Under the terms of the placement, which was announced on August 4, 2020, the company issued a total of 4 million common shares at a price of $5.00 each.
Eric had originally said that he would subscribe for 3 million shares for a total of $15 million, but the placement closed with the prolific precious metals investor subscribing for a package of 2.5 million common shares.
Prior to the financing, Eric held 6,089,099 common shares, representing approximately 11.8 per cent of Chesapeake’s issued and outstanding securities. Now, this amount has been bumped to a total of 8,589,099 shares, which represents roughly 15.5 per cent of the company.
In addition to Eric’s involvement, The Sun Valley Master Gold Fund, a hedge fund with approximately $381.2 million in assets, acquired 1 million common shares for a total of $5 million.
Chesapeake intends to use the proceeds to fund metallurgical test work at its Metates project in Durango, Mexico, which is considered to be one of the largest undeveloped gold and silver deposits in the world.
According to a NI 43-101 report conducted by Independent Mining Consultants of Tucson, Arizona, the project is thought to host proven and probable reserves of 18.5 million ounces of gold, 526 million ounces of silver and 4.2 billion pounds of zinc.
A portion of the proceeds will also be used to fund ongoing regional exploration activities, as well as for general working capital.
Chesapeake Gold (CKG) is currently down 6.77 per cent and is trading at $5.92 per share at 2:50pm EDT.