Agnico stake in Fury Gold could rise to 9.9%

Agnico Eagle Mines (TSX, NYSE: AEM) has nearly tripled its equity position in junior explorer Fury Gold Mines (TSX, NYSE-A: FURY) with a further $4.3-million investment.

Most of the new investment ($3.9 million) is to be used for this year’s exploration at Fury’s Committee Bay project in the Kitikmeot region of Nunavut, according to a news release on Tuesday. The project is located 180 km northeast of Agnico’s Meadowbank mine and covers a district-scale area of more than 2,500 sq. km.

The new investment takes Agnico’s holding to 6.3%, potentially rising to 9.9% if the deal’s warrants are exercised. Agnico previously held 3.75 million or 2.3% of Fury’s shares.

Shares in Fury Gold Mines rose 3.9% to close at 54¢ apiece on Tuesday, valuing the company at $86.6 million. Agnico stock closed 0.6% weaker at $160.79 each for a market capitalization of $80.8 billion as Canada’s biggest gold company.  

Warrants

In the deal, Agnico acquired 6.73 million Fury shares and warrants to buy the same number of shares for a per-unit price of 64¢. The warrants have an exercise price of 80¢ per share, valid for three years.

From its exploration efforts since 2019, the Fury team has identified numerous high-grade gold occurrences throughout a 300-km strike length at Committee Bay. The most significant is the Three Bluffs deposit, which has a mineral resource estimate of 2.1 million indicated tonnes grading 7.85 grams gold per tonne for 523,835 oz. contained gold and 2.9 million inferred tonnes grading 7.63 grams for 720,364 oz. contained gold.

“We are pleased to have Agnico Eagle, one of Canada’s premier companies and a top global gold producer, make an additional investment that will permit Fury to advance our understanding of the exploration potential at our Committee Bay project in Nunavut,” commented Tim Clark, CEO of Fury Gold Mines.

“We believe the Arctic is likely to become increasingly important for future mineral exploration and with this in mind, we are excited to accelerate our plans to build on past drilling success.”