Canada's Pecoy Copper plans to raise C$49.8 million to develop Peruvian copper-gold mine

en.Wedoany.com Reported - On November 2, Canadian mining exploration company Pecoy Copper signed share subscription agreements with Hudbay Minerals and another strategic investor to raise approximately C$49.8 million through a non-brokered private placement. The proceeds will be used for ongoing drilling, mineral resource definition and expansion, as well as geological and metallurgical studies and mineral resource updates at the Pecoy copper-gold project in the Arequipa region of southern Peru. The transaction is expected to close on or about November 5.

Under the subscription agreements, Hudbay Minerals plans to invest approximately C$30.1 million to subscribe for 14,914,100 common shares, while the other strategic investor plans to invest approximately C$19.7 million to subscribe for 9,762,425 shares. Both investors will subscribe at a price of C$2.02 per share, representing a 10% premium to the 10-day volume-weighted average price on the TSX Venture Exchange as of October 30.

Upon completion of the financing, Hudbay Minerals and the other strategic investor are each expected to hold approximately 9.99% of Pecoy Copper on a partially diluted basis. Hudbay Minerals will also enter into an investor rights agreement with Pecoy Copper, granting it pro-rata participation rights in future equity financings and the right to nominate one director, provided it maintains the agreed ownership percentage; if the board consists of 10 or more directors, its director nomination entitlement may increase to two.

Pecoy Copper plans to allocate the net proceeds to its existing drilling program, mineralization expansion, resource model updates and metallurgical testing, as well as general working capital. The Pecoy project and the adjacent Tororume project together cover approximately 19,800 hectares of mineral claims. The financing remains subject to customary closing conditions and receipt of relevant approvals, including from the TSX Venture Exchange. The newly issued shares will be subject to hold periods under applicable securities laws.