Barrick bets on BC with 9.9% Kingfisher stake

Barrick Mining (TSX: ABX; NYSE: B) is acquiring an almost 10% stake in Canadian explorer Kingfisher Metals (TSX-V: KFR) through a $20.9-million private placement, backing the junior’s exploration efforts in British Columbia’s Golden Triangle.

The major gold producer will purchase 15.5 million units at $1.35 each in a non-brokered financing expected to around July 27. Each unit includes one common share and half a warrant, with each whole warrant exercisable at $1.70 for two years. 

The transaction will give Barrick an approximate 9.9% stake in Kingfisher on a non-diluted basis, rising to 14% if all warrants are exercised. 

Barrick has agreed that at least 80% of the proceeds will fund exploration and development at Kingfisher’s HWY 37 project, with the remainder allocated to working capital and general corporate purposes.

Strategic backing

“This strategic investment is an endorsement of the prospectivity of our Golden Triangle land position and our technical team’s ability to execute,” Kingfisher president and CEO Dustin Perry said in a separate statement.

The investment strengthens Barrick’s exposure to one of Canada’s most active copper-gold exploration districts while providing Kingfisher with the capital to accelerate drilling at its Hank porphyry discovery and across its broader land package. 

Following the financing, the junior expects to hold about $47 million in cash, giving it flexibility to pursue an aggressive exploration program as demand for new copper discoveries continues to grow.

Kingfisher’s stock surged 23% on Tuesday morning in Toronto to $1.26 apiece, valuing the company at nearly $134 million. Shares in Barrick Mining rose 1.7% to $49.88 each, for a market capitalization of $84.1 billion.