Pure Gold Mining (TSXV: PGM) on Monday announced that it had applied for creditor protection under the Companies’ Creditors Arrangement Act (CCAA) with the Supreme Court of British Columbia. Typically, creditor protection, as the name suggests, means that only debtholders get the chance to salvage holdings while shareholders unfortunately typically lose their investment.

This means that billionaire mining financier Eric Sprott, with a stake of 6.7%, second only to AngloGold Ashanti’s 16.5%, would be the second biggest loser in the Pure Gold fallout. The billionaire, according to the Globe and Mail, “could very well” have lost $100 million.

“I don’t think I lost $100 million, but it could very well be,” Sprott said in an interview. “At this point in time, the bigger the better, because it’s a tax write-off. Now that it’s worth nothing, please tell me I lost $100 million or $200 million. I’ll use the tax loss.”

Pure Gold, which now only holds about $2 million in the bank, has about $200 million in liabilities. Sprott may not lose it all, it seems. As the junior miner’s biggest lender also happens to be Sprott Resource Lending, a company owned by Sprott-founded Sprott Inc.

Pure Gold Mining last traded at $0.01 on the TSX Venture.

Information for this briefing was found via The Globe and Mail, and the sources and companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.