Silver Valley Metals cancels C$2.4M private placement
The explorer will reassess working capital needs and financing alternatives after dropping its October offering.
Mara Quinlan
Silver Valley Metals Corp. CVESILV OTCMKTSSVMFF reported on Friday that it has cancelled its proposed C$2.4 million non-brokered private placement. The decision removes the planned sale of up to 30 million units that was to support working capital, project work and potential acquisitions.
Shares fell 5.3 per cent to C$0.09 on the TSX Venture Exchange at Thursday's 4:00 p.m. EST close, as shown in the CVESILV quote. The close preceded Friday's cancellation announcement.
The company said it will reassess working capital requirements and consider financing alternatives, without giving a reason for cancelling the offering. Friday's release provides no replacement amount, financing terms or exploration schedule.
The Oct. 7 offering would have priced units at C$0.08 each, with one common share and one share purchase warrant per unit. Each warrant would have allowed the holder to buy another share at C$0.12 for 24 months after issuance.
The maximum proposed share issuance equalled about 83 per cent of the 35.96 million shares outstanding shown in the CVESILV quote at Thursday's 4:00 p.m. EST close.
Three insiders had planned to subscribe for C$470,000 of the October financing, and no finder's fees were payable. The offering required TSX Venture Exchange approval and would have carried a statutory hold of four months and one day.
The October announcement earmarked net proceeds for working capital and general corporate purposes, including existing projects, acquisitions and strategic investments. It made no final allocation among those uses and allowed management to change the allocation as opportunities and market conditions changed.
"The Company will continue to assess its working capital requirements and evaluate financing alternatives, as and when appropriate, to support its ongoing operations and future corporate initiatives," the company said in Friday's release.
Silver Valley announced on Feb. 18 that it had closed a separate C$2 million financing by issuing 16,666,667 units. Those units cost C$0.12 apiece and included warrants exercisable at C$0.25 for 24 months.
The February proceeds were designated for acquiring a mineral project, maintaining and selectively advancing Mexi-Can, and general working capital. The cancellation notice gives no cash balance or spending budget, so it does not quantify the company's remaining funding needs.
Silver Valley is a Canadian explorer whose wholly owned Mexi-Can lithium-potash project covers 4,056 hectares in Mexico's Zacatecas and San Luis Potosi states. The company said on Friday it continues to evaluate acquisitions and strategic investments alongside work on its existing assets.
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Friday's release sets no date for a replacement financing, a new exploration program or the company's next project update.
