Arizona Sonoran Copper Company Inc. (TSX: ASCU, OTCQX: ASCUF) has successfully completed a private placement, raising C$21.6 million, which will significantly bolster its development initiatives in the U.S. copper sector. The financing was primarily driven by a substantial investment from Hudbay Minerals Inc. and the exercise of pre-emptive rights by Nuton LLC, a venture of Rio Tinto.
The private placement involved the issuance of 12,885,157 common shares at a price of C$1.68 each. Hudbay acquired 11,955,270 shares for gross proceeds of approximately C$20.08 million, thereby increasing its stake in Arizona Sonoran to 9.99%. This strategic investment not only strengthens Hudbay’s position but also reflects its confidence in Arizona Sonoran’s flagship Cactus Project, which is poised for significant development.
Nuton exercised its rights to maintain a 7.2% equity interest in the company, contributing an additional C$1.56 million to the total proceeds. The funds raised will be allocated towards drilling, exploration, and advancing technical studies related to the Cactus Project, as well as general corporate purposes.
George Ogilvie, President and CEO of Arizona Sonoran, expressed enthusiasm regarding the completion of this financing round. He stated that the funds would provide the company with the necessary runway to execute its 2025 work programs effectively. A key focus for this year is to prepare updated technical data on the Parks/Salyer deposit and produce a Pre-Feasibility Study in the latter half of 2025.
Ogilvie highlighted the strategic importance of Hudbay’s involvement: “Welcoming Hudbay as a strategic investor is an endorsement from a well-respected entity with extensive experience in mine development and construction. We look forward to leveraging their expertise as we advance our Cactus Project toward a final investment decision.”
The Cactus Project is located on privately held land and contains a large-scale porphyry copper resource. Recent assessments indicate that it has robust economic potential, with plans for an open-pit operation that could yield significant returns over its operational life. The project benefits from an efficient permitting process and existing infrastructure, positioning it as a lower-risk development opportunity within the U.S.
Hudbay’s CEO, Peter Kukielski, reinforced this sentiment by describing Cactus as “an exciting copper development project” that aligns with Hudbay’s strategy to enhance its portfolio in tier-1 mining jurisdictions like the U.S.
The completion of this private placement marks a pivotal moment for Arizona Sonoran as it seeks to establish itself as a mid-tier copper producer with low operating costs. The company aims to generate sustainable returns while maintaining responsible operations that benefit local communities and stakeholders alike.