Agnico Eagle Mines (TSX:AEM,NYSE:AEM) said it plans to expand its investment in Collective Mining (TSX:CNL,NYSE:CNL) through a non-brokered private placement valued at C$52.16 million.
The company will purchase 4,741,984 common shares of Collective at C$11 each via the private placement; it will also do an early exercise of 2,250,000 previously held common share purchase warrants at C$5.01 each.
Upon closing, Agnico Eagle will hold approximately 14.99 percent of Collective’s outstanding common shares on a non-diluted basis. The private placement is expected to close on or about March 20, pending regulatory approvals.
In total, the two transactions will bring Agnico Eagle’s investment to C$63.43 million.
Agnico Eagle’s decision to increase its position in Collective aligns with its strategy of acquiring stakes in companies with early stage projects that it believes have strong geological potential.
The investment provides exposure to Collective’s flagship Guayabales project, a gold, silver, copper and tungsten exploration asset located in a prolific Colombian mining region. Led by a team with a track record of success, Collective is advancing high-grade discoveries at the site, including the newly identified Ramp zone.
Agnico Eagle made an initial investment in Collective in February 2024, and at the time the companies established an investor rights agreement granting Agnico Eagle certain participation rights in future financings.
The deal has now been amended to increase Agnico Eagle’s participation rights threshold from 9.99 percent to 14.99 percent on a partially diluted basis, ensuring the company maintains a proportional stake in Collective’s growth.
While Agnico Eagle has no current plans to seek board representation, the agreement allows for the nomination of directors should the company’s ownership percentage warrant such a role in the future.
The proceeds from the investment will be used to fund Collective’s ongoing exploration activities, particularly at Guayabales, which has demonstrated promising high-grade mineralization. The company has been rapidly expanding its drill program, with a focus on defining and extending the Apollo system, which hosts the Ramp zone.
“I would like to thank Agnico Eagle for its additional support as we continue to advance our Guayabales Project. The proceeds received will enable us to continue with our planned drill program, and we look forward to releasing results in the near term,” said Ari Sussman, executive chairman of Collective, in the company’s release about the news.
Collective announced results from two drill holes at the Ramp zone last week, including the longest and best intercept to date — 75.8 meters grading 8.01 grams per metric ton gold equivalent.
The discovery remains open in all directions, with aggressive drilling planned to test its full extent. Collective’s 2025 drilling program includes 60,000 meters of fully funded exploration across its Guayabales and San Antonio projects.
Currently six drill rigs are active, with additional rigs scheduled to begin operations in the coming months. Approximately 110,000 meters of diamond drilling have been completed to date at Guayabales, with 74,000 meters focused on Apollo.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.