MGX Minerals Inc (CSE:XMG) (OTCMKTS:MGXMF) informed investors on Wednesday that its subsidiary MGX Renewables Inc is one step closer to listing on the Canadian Securities Exchange as an independent entity.
The Vancouver-based company said that it had closed a financing of just over C$2 million through the sale of 8 million subscription receipts at $0.25 per receipt. Subscription receipts will be converted into common shares once the transaction closes.
Shares of MGX Minerals gained 2% on Wednesday morning trading to C$0.26.
The proceeds from the offering will be held in escrow until the spinout takes place, and once certain other escrow release conditions are met. The spinout is expected to occur immediately following the closing of the plan of arrangement.
Under the transaction terms, each subscription receipt represents the right to automatically receive one unit of MGX Renewables, comprising of one MGXR share and one-half of one warrant, exercisable at $0.35 until November 30, 2020.
The warrants contain a clause that outlines MGXR’s option to accelerate the expiry date of the warrants if the volume-weighted average trading price of the shares exceeds $0.50 for 10 consecutive trading days.
The spinout is non-dilutive to MGX Minerals shareholders, the company said in a statement.
MGX Renewables is advancing zinc-air flow batteries with 20 patents granted so far designed for high capacity and long duration. They can be used in a wide range of energy storage applications in the fields of renewable energy, industrial backup power and grid-scale energy.
Last month the subsidiary received conditional approval to list on the Canadian Securities Exchange.
MGX Minerals is a diversified Canadian resource and technology company with interests in global advanced material, energy and water assets.
--Updates with share price--
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