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Great Bear Resources closes on C$33M bought deal private placement

The proceeds will be used for Canadian exploration expenses at Great Bear's projects in Ontario

Great Bear Resources - Great Bear Resources Ltd closes on C$33 million bought deal private placement
The Vancouver company has about $53 million in cash and is fully funded for continuous exploration drilling through 2022

Great Bear Resources Ltd (CVE:GBR) (OTCMKTS:GTBDF) has closed on a bought deal private placement that raised C$33 million.

The company issued a total of 1,470,600 common shares that qualify as "flow-through shares" for tax purposes at C$17 each and 725,000 common shares for C$11.04 apiece.

The proceeds will be used for Canadian exploration expenses at Great Bear's projects in Ontario and for general corporate purposes.

READ: Great Bear Resources strikes exploration deal with two First Nations groups in Ontario

A flow-through share is a type of share issued by a corporation to a taxpayer and sees the issuing firm agree to incur eligible exploration expenses in an amount up to the consideration paid for the shares. The firm then 'renounces' the amount of the expenditure so that the expenses are considered to be the taxpayer's expenses for tax purposes.

Great Bear said that it will renounce these expenses to the purchasers no later than December 31 this year. In addition, the offered shares have a hold period of four months and one day from closing, expiring on October 5, 2020.

The offering was completed through a syndicate of underwriters, led by Canaccord Genuity Corp, that will get a 6% cash commission on the gross proceeds.

Great Bear said it has about $53 million in cash and is fully funded for continuous exploration drilling through 2022. 

The Vancouver-based company is focused in the prolific Red Lake gold district in northwest Ontario, where it controls 300 square kilometers of highly prospective tenure across four projects - the Dixie project, the Pakwash property, the Dedee property and the Sobel property.

In May, Great Bear said it had hit the deepest and highest-grade interval to date on its flagship Dixie project. The hole hit deep extensions of the Dixie Limb around 740 metres below the surface and new Hinge zone-style veins around 840 metres below the surface, which doubles the known depth of gold mineralization.

Contact the author: [email protected]

Follow him on Twitter @PatrickMGraham

Quick facts: Great Bear Resources

Price: 18.5 CAD

TSX-V:GBR
Market: TSX-V
Market Cap: $925.77 m
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