Copper Giant (TSXV: CGNT) has found itself a new backer. Denarius Metals (CBOE: DMET) is buying a 15.6% stake in the copper developer, anchoring a C$31 million financing that lands alongside a decade long supply deal with commodities trader Trafigura.
Denarius is investing C$28.8 million under the funding round, while also agreeing to a two year lock-up on the position. The wider raise priced 43 million shares at C$0.72 each, leaving Copper Giant with roughly 256 million shares outstanding once the deal closes.
“This transaction changes the trajectory of Mocoa,” said Ian Harris, Copper Giant’s president and chief executive. “Denarius’s investment gives us the capital to move through the PEA and accelerate the next phase toward a construction decision, while Trafigura provides a long-term route to global markets.”
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The offtake, which hinges on the financing closing, gives Trafigura 20% of Mocoa’s copper concentrate and 20% of its molybdenum concentrate at market terms for ten years from the start of commercial production. The volumes are subject to annual minimums, and Trafigura can extend the term if they fall short.
Proceeds are earmarked for exploration and development at Mocoa, which the company bills as one of the largest undeveloped resources of its kind in the Americas.
Financier Frank Giustra also joined the round, and Denarius chief executive Federico Restrepo-Solano is taking a seat on Copper Giant’s advisory board, though not the board of directors.
“We know Colombia and we know what it takes to move a project from resource to operation,” said Denarius executive chairman Serafino Iacono.
The financing is expected to close August 21.
Copper Giant last traded at $0.87 on the TSX Venture.
