Americas Gold and Silver Corporation Secures $100 Million Debt Facility for Galena Complex Growth
- Americas Gold and Silver secures a $100 million debt facility to enhance growth at the Galena Complex.
- The financing includes three tranches, with initial funds of $50 million released at closing.
- The company consolidates ownership of the Galena Complex to 100%, boosting institutional and insider ownership.
Americas Gold and Silver Corporation Secures $100 Million Debt Facility for Galena Complex Development
Americas Gold and Silver Corporation announces a pivotal $100 million senior secured debt facility aimed at accelerating growth and operational advancement at its Galena Complex. The financing is structured in three distinct tranches, with an initial $50 million to be disbursed at closing, followed by two additional $25 million tranches contingent upon the fulfillment of specific conditions. This financial arrangement is designed to support the company's strategic initiatives as it seeks to solidify its position within the North American silver production sector. The interest rate for the loan is tied to the Secured Overnight Financing Rate (SOFR), with a 4% floor, plus an additional 6%, and is set to mature 60 months post-closing. Principal repayments commence one year after closing, with quarterly payments thereafter.
The debt facility not only enhances Americas Gold and Silver's liquidity but also positions the company to bolster its operational capabilities at the Galena Complex. The facility's structure allows for a phased funding approach that aligns with the company's projected growth trajectory. Furthermore, the subsequent tranches offer a slightly more favorable interest rate tied to SOFR, thereby providing the company with additional financial flexibility as it navigates the complexities of the mining sector. The lender retains senior security over all company assets, excluding those associated with the Americas Cosalá Operations in Mexico and Relief Canyon Project in Nevada, which are already secured under existing agreements.
In conjunction with the new financing, the company has effectively consolidated its ownership of the Galena Complex from 60% to a full 100%, following a strategic deal that has positioned Eric Sprott as the largest shareholder with a 20% stake. This consolidation marks a significant milestone for Americas Gold and Silver, reflecting a robust institutional and insider ownership increase from 8% to over 60%. The revitalization of the Galena Complex is further supported by the company's recent C$50 million bought deal financing, aimed at funding operational upgrades while concurrently reducing liabilities. The leadership team, under the direction of Chairman and CEO Paul Huet, is committed to optimizing infrastructure and driving production growth, emphasizing a proactive approach to managing risks associated with fluctuating commodity prices and regulatory challenges.
In addition to the debt facility, Americas Gold and Silver plans to initiate a non-brokered private placement, aiming to raise CAD 15.96 million from Ocean Partners USA Inc. The company intends to issue 16,800,000 common shares at a price of CAD 0.95 per share, with the anticipated closing date set for June 4, 2025, pending necessary regulatory approvals. This initiative underscores the company's strategy to enhance its financial position and ensure that it has the capital resources needed to support ongoing projects.
Overall, these developments represent a concerted effort by Americas Gold and Silver Corporation to strengthen its financial foundation and pursue growth opportunities within the competitive mining sector, particularly as it focuses on maximizing the potential of the Galena Complex.