Samco Gold Ltd. plans to recapitalize through a private placement and, meanwhile, settle debt by transferring royalties and issuing shares.
The company said Aug. 14 that it would issue up to 30 million common shares from treasury at 5 Canadian cents apiece to raise as much as C$1.5 million in a private placement that it would extend to existing shareholders on a pro rata basis.
Samco Gold Chairman and CEO Charles Koppel intends to buy up to C$750,000 of the offering, depending on investor reception.
Meanwhile, the company also plans to settle debts with shares and royalties, subject to definitive agreements. Samco said it would pay back a portion of debt owed to Koppel and Sentient Global Resources Fund IV LP by issuing 21,031,612 shares at the same price.
It also planned to transfer a 1.5% net smelter royalty on the El Dorado Monserrat gold property and a 2% royalty on the Corina silver-lead project, both in Argentina, to Koppel and Sentient Global to pay back remaining debt.