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Marathon to raise up to C$20.1M for development of Valentine Lake gold project

Marathon Gold Corp. entered an agreement for a bought-deal private placement to raise C$20.1 million for ongoing exploration and development of its Valentine Lake gold project in Newfoundland and for general corporate purposes.

The offering will comprise 2,710,000 flow-through units at C$1.85 apiece and 11.4 million common share units at C$1.32 apiece, the company said Sept. 6. The deal is expected to close around Sept. 30.

Each flow-through unit will consist of one flow-through share and one-half of a common share purchase warrant, while each common share unit will consist of one common share and one-half of a common share purchase warrant. Each warrant will be exercisable at C$1.60 per share for 24 months from closing.

Marathon Gold will also grant the syndicate of underwriters, led by Canaccord Genuity Corp. and Sprott Capital Partners, an option to sell up to an additional 2,710,000 flow-through units for additional proceeds of up to about C$5 million, exercisable up to 48 hours before closing.

The company noted that Franco-Nevada Corp., which acquired a 2% net smelter royalty on the Valentine Lake project for C$18 million in February, intends to participate in the offering.