After accepting and then rejecting an unpopular $50-million financing through 7% convertible notes North American Palladium (PDL-T, PAL-X) has found a way to raise the money, and then some, via flow-through shares and equity in two bought-deals announced today.
The operator of the halted Lac des Iles palladium mine in northern Ontario and soon-to-be-producing Sleeping Giant gold mine in Quebec will add $65 million to its treasury for exploration and development.
North American will issue 4 million flow-through shares at $3.75 apiece for a total of $15 million.
The company will issue another 16 million units at $3.15 apiece amounting to $50.4 million. Each unit consists of one share and one half-share purchase warrant exercisable at $4.25 per one share within the next two years. If North American’s stock rises above $5.75 per share the company can accelerate the expiry dates of the warrants.
A syndicate of underwriters led by Thomas Weisel Partners first agreed to a $35.3 million equity financing but later in the day that amount was increased to $50.4 million.
The company did not mention who was involved in the flow-through financing.
A few weeks ago, North American decided a convertible note financing with Casimir Capital was too onerous, and having no long-term debt and $60 million in the treasury, the company decided to hold off. News of that deal caused shares to fall 8% in one day on Aug. 17 to $3.04 but shares went back up once it was canceled.
North American shares fell nearly 8%, or 29¢, today to $3.09, on a trading volume of nearly 2 million shares.