Sierra Madre Closes $40 Million First Tranche of $50 Million Offering
Sierra Madre Gold and Silver Ltd. announced it has closed the first tranche of its $50 million offering, raising approximately $40 million. The funds are earmarked for the acquisition of the Del Toro Silver Mine in Mexico.
Vancouver, British Columbia – Sierra Madre Gold and Silver Ltd. (TSXV: SM) has announced the closing of the first tranche of its brokered private placement offering, raising approximately $39.7 million. The company issued 30,521,724 subscription receipts at $1.30 per receipt.
The proceeds from this tranche are intended to fund the company's proposed acquisition of the Del Toro Silver Mine in the Chalchihuites District of Mexico from First Majestic Silver Corp. Each subscription receipt is expected to be automatically exercised for one common share upon satisfaction of certain escrow release conditions, including all necessary corporate, shareholder, and regulatory approvals for the transaction.
A significant portion of the proceeds, approximately $38.6 million, has been placed into escrow. These funds will be released to Sierra Madre upon the successful completion of the transaction and fulfillment of all release conditions by May 14, 2026. If these conditions are not met, the escrowed funds will be returned to the holders of the subscription receipts.
Sierra Madre intends to close a second tranche of the offering and plans to use the net proceeds to finalize the acquisition, fund exploration and development of the Del Toro mine post-acquisition, and for general working capital. The company also paid agents' fees and issued compensation options.
Securities issued in connection with the offering are subject to a four-month hold period and require final approval from the TSX Venture Exchange. Certain directors and officers of the company participated in the offering, subscribing for 219,250 subscription receipts.