New Found Gold Corp (OTCMKTS:NFGFF) jumped 5%after announcing the closing of its previously announced offering of 5.0485 million flow-through common shares. The shares qualify as flow-through shares in the context of paragraph 66(15) of the Canadian Income Tax Act.
The company is offering the shares at $11.39 per Flow-Through Share and expects gross proceeds of around $576.5 million, including underwriters’ option to exercise an overallotment.
The company completed the offering as per the underwriting agreement entered on August 19, 2021, between the company and an underwriters syndicate led by BMO Capital markets and Canaccord Genuity Corp. Other underwriters include COBC World Markets Inc.
In addition, Clarus Securities Inc. and Desjardins Securities Inc. Eric Sprott took part in the offering contributing around 19.9% of this financing to keep his interest in the company. Proceeds from the offering will be used as exploration expenses qualifying as flow-through mining expenses as defined in the Income Tax Act. NFGFF is worth watching in the coming weeks.
Market Reaction:
On Tuesday, NFGFF stock gained 4.53% at $7.15 with more than 103k shares, compared to its average volume of 145k shares. The stock has moved within a range of $ =6.78 – 7.17 after opening the trade at $6.90.
