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New Pacific Metals Corp. and Pan American Silver Corp. have announced concurrent offerings. New Pacific has announced today that it has entered into an agreement with BMO Capital Markets (“BMO”) as sole underwriter, under which BMO has agreed to buy on bought deal basis 4,238,000 common shares (the “Common Shares”), at a price of C$5.90 per Common Share for gross proceeds of approximately C$25 million (the “Offering”). The Company has granted BMO an option, exercisable at the offering price for a period of 30 days following the closing of the Offering, to purchase up to an additional 15% of the Offering to cover over-allotments, if any. The Offering is expected to close on or about June 9, 2020 and is subject to the Company receiving all necessary regulatory and stock exchange approvals.
The net proceeds of the Offering will be used to advance exploration and development at the Company’s wholly-owned Silver Sand project, for working capital, and for general corporate purposes.
The Common Shares will be offered by way of a short form prospectus in each of the provinces of Canada, excluding Quebec and may also be offered by way of private placement in the United States.
In connection with the Offering and in a separate transaction, Pan American has sold to BMO 8,000,000 common shares of New Pacific that it held at the same price per common share as under the Offering (the “Concurrent Block Trade”). These common shares will be resold to the public by BMO. The Concurrent Block Trade is expected to close on or about May 21, 2020.
Upon completion of the Concurrent Block Trade, Pan American will own, directly or indirectly, 14,724,068 common shares of New Pacific, representing an approximate 9.7% ownership interest in the Company, assuming the over-allotment option is not exercised.
Dr. Mark Cruise, Chief Executive Officer of New Pacific said, “Pan American has been supportive of the Company and the Silver Sand project since inception. Pan American will continue to have representation on our Board of Directors and be a significant shareholder, demonstrating their continued commitment to the project. The concurrent capital infusion will enable the Company to continue to explore and advance our Silver Sand deposit in addition to focus on new targets within the emerging silver district and regionally.”
Michael Steinmann, President and Chief Executive Officer of Pan American said, “Silver Sand is an exciting discovery and New Pacific has done excellent work advancing the project to the initial resource stage. This transaction presented a timely opportunity for Pan American to further strengthen our balance sheet by realizing gains on part of our investment in New Pacific, while maintaining a significant interest and commitment to the future of the project.”
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Pan American Early Warning Report Information
Prior to the Concurrent Block Trade, Pan American held approximately 22,724,068 common shares of New Pacific, representing approximately 15.4% of the total number of issued and outstanding common shares on a non-diluted basis, and approximately 14.7% of the issued and outstanding common shares of New Pacific on a fully-diluted basis. Immediately following the Block Trade, Pan American directly owned 14,724,068 common shares, representing approximately 9.96% of the total number of issued and outstanding common shares of New Pacific on a non-diluted basis, and approximately 9.6% of the issued and outstanding common shares of New Pacific on a fully-diluted basis.
Pan American’s sale of the New Pacific common shares was made for investment purposes and it may, in the future, dispose of additional common shares of New Pacific, or acquire ownership and control over additional common shares of New Pacific for investment purposes.
The foregoing disclosure regarding Pan American’s holdings is being disseminated pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues. A copy of the early warning report will be filed on the System for Electronic Document Analysis and Review (SEDAR) under New Pacific’s profile at www.sedar.com and may be obtained by contacting Ms. Siren Fisekci, VP, Investor Relations for Pan American, at 604-684-1175.
About New Pacific
New Pacific is a Canadian exploration and development company which owns the Silver Sand Project in Potosí Department, Bolivia and the Tagish Lake gold project in Yukon, Canada.
About Pan American
Pan American owns and operates silver and gold mines located in Mexico, Peru, Canada, Argentina and Bolivia. We also own the Escobal mine in Guatemala that is currently not operating. As the world’s second largest primary silver producer with the largest silver reserve base globally, we provide enhanced exposure to silver in addition to a diversified portfolio of gold producing assets. Pan American has a 25-year history of operating in Latin America, earning an industry-leading reputation for corporate social responsibility, operational excellence and prudent financial management. We are headquartered in Vancouver, B.C. and our shares trade on NASDAQ and the Toronto Stock Exchange under the symbol “PAAS”.
For further information, contact:
New Pacific Metals Corp.
Phone: (604) 633-1368
Fax: (604) 669-9387
Pan American Silver Corp.
VP, Investor Relations & Corporate Communications
Phone: (604) 806-3191