Hecla participates in $7M Dolly Varden financing

A helicopter at Dolly Varden Silver’s namesake silver project in northwest British Columbia.Credit: Dolly Varden Silver.A helicopter at Dolly Varden Silver’s namesake silver project in northwest British Columbia.Credit: Dolly Varden Silver.

Silver and gold producer Hecla Mining (NYSE: HL) has participated in Dolly Varden Silver’s (TSXV: DV; US-OTC: DOLLF) $7-million flow-through private placement to maintain a 10.7% interest in the silver-focused junior.

As part of the financing, Hecla acquired a total of 807,846 shares of Dolly Varden, at 89¢ per unit, for gross proceeds of $718,983. This subscription was part of an ancillary rights agreement allowing Hecla to maintain its pro-rata share in the company.

After the raise, the producer would hold 13.9 million shares of the explorer and 940,948 warrants. Assuming the warrants are exercised, Hecla would then hold 14.8 million shares of Dolly Varden for an 11.3% stake.

According to the company, the shares have been acquired for investment purposes, and “Hecla does not have any present intention to acquire ownership of, or control over, additional securities of Dolly Varden.” Hecla plans on evaluating its shareholding on an ongoing basis.

Hecla is a silver producer, with mines in Alaska, Idaho and Mexico, and also generates gold from mines in Quebec and Nevada. This year, the company expects to generate 10.9-11.9 million oz. silver and 195,000 to 208,000 oz. gold.

Dolly Varden is a B.C.-focused silver explorer, where it holds 88 sq. km of ground within the past-producing Dolly Varden project in the northwestern part of the province, in the Golden Triangle. The property includes an indicated resource of 3.4 million tonnes, grading 300 g/t silver, and an inferred resource of 1.3 million tonnes, at 277 g/t silver.

— This article first appeared in the Canadian Mining Journal, part of Glacier Resource Innovation Group

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