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Agnico Eagle Takes 12% Stake In Canada Nickel For $23.1 Million

Canada Nickel Company (TSXV: CNC) evidently is raising funds via a flow through financing. In a rare positive end-of-year news release, it was disclosed that Agnico Eagle Mines (TSX: AEM) has acquired a large stake in the nickel explorer.

Rather than purchase units direct from the company, Agnico acquired 19.6 million units of Canada Nickel from several participants that acquired units under a flow through financing conducted by Canada Nickel. The units were purchased at $1.18 a piece, and contain one common share and 0.35 of a purchase warrant. Warrants contain an exercise price of $1.77 per share, and expire December 29, 2026.

Reference to an ongoing flow through financing currently being conducted by Canada Nickel could not be found, making it unclear when specifically the units were originally sold.

Agnico indicated that the investment represents “an early stage investment” into the critical minerals sector, after spending two years evaluating the sector with a focus on Canadian opportunities specifically. The investment into Canada Nickel is said to “represent an opportunity to establish a presence in an emerging nickel belt and monitor both the project’s progress and emerging technologies relevant to its development.”

The overall investment amounts to a 12% stake in Canada Nickel on a non-diluted basis.

Post-investment, Agnico has obtained the right to participate in equity financings, along with top-up rights and the right to appoint one person to the board of Canada Nickel. Agnico however stated it has no intention to exercise its board rights.

The investment follows Canada Nickel in October releasing a much awaited feasibility study, which outlined an after-tax net present discount (8%) of $2.5 billion for the Crawford project. The project has proven and probable reserves of 3.8 million tonnes of contained nickel at 0.22%. Measured and indicated resources sit at 6.0 million tonnes, while inferred mineral resources amount to 3.7 million tonnes of contained nickel.


Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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