Almaden Minerals Ltd. (AMEX: AAU) saw a drop today by a percentage of -14.87% to the current price of $0.62. It previously closed at $0.73.
The downward movement of the AAU stock comes along with the news of Almaden Minerals (AAU) announcing that there is a direct offering registered at $10.3 million.
Glancing into Almaden Minerals Ltd
Almaden Minerals Ltd (AAU) owns 100% of the Tuligtic project in Mexico. Specifically, the project covers the Ixtaca Gold-Silver Deposit that Almaden had discovered in 2010 and claimed through staking. According to Almaden’s website, the Ixtaca Deposit contains an estimated reserve of 65.1 million tons grading 1.29 million ounces of gold and 78.8 million ounces of Silver.
15 million shares of AAU sold through direct offering
AAU announced that it has entered into a definitive agreement with certain institutional investors for the sale and purchase of 15,846,154 shares of its common stock and common stock warrants the purchase of up to 7,923,077 shares of common stock at a combined purchase price of US$0.65 per share aggregate gross proceeds of US$10.3 million in a registered direct offering (RDO).
What makes this offering important?
The reason for making this registered direct offering is so that AAU can finance the preparation and submission of permit applications. These permits are required for the commencement of construction of the Ixtaca project, incremental exploratory expeditions, consulting costs and general operational costs.
Now that Almaden Minerals Ltd (AAU) has received the capital offering, it will also resume exploration of the Ixtaca gold-silver project. Furthermore, it will be addressing the environmental permit setback that it received in December. The permit was not approved due to the requirement of additional MIA data and had been held up for 12 months awaiting a separate mineral title matter. The court that is supposed to grant the environmental permit reinstated Almaden’s original claim block despite AAU’s requesting the reduction of its land package to half.
