Canada Nickel Company Inc. (“Canada Nickel”) (TSXV: CNC) (OTCQX: CNIKF) has successfully secured a US$15 million loan facility from Auramet International, Inc. (“Auramet”). This strategic financial move, initially announced on June 24, 2024, aims to bolster Canada Nickel’s working capital as it continues to advance its key projects.
The loan, due on January 9, 2025, carries an interest rate of 1.00% per month and includes a 2.5% arrangement fee. As part of the agreement, Auramet received 750,000 1-year warrants with a strike price of $1.42 per common share. These warrants and their underlying shares are subject to a four-month hold period under applicable Canadian securities laws. The loan terms also include specific positive and negative covenants that are customary for transactions of this nature.
Canada Nickel intends to use the proceeds from the loan primarily for working capital purposes, ensuring the smooth progression of its projects. This funding is crucial as the company pushes forward with its initiatives aimed at supplying the nickel required for the high-growth electric vehicle and stainless steel markets.
The Crawford Nickel-Cobalt Sulphide Project, Canada Nickel’s flagship asset, stands at the heart of the Timmins-Cochrane mining camp. This project is central to the company’s strategy of delivering high-grade nickel, cobalt, and iron products with minimal carbon footprints. The company has also applied to trademark terms such as NetZero Nickel™, NetZero Cobalt™, and NetZero Iron™ in various jurisdictions, underscoring its commitment to sustainable mining practices.
Auramet, as a leading player in the precious metals merchant sector, provides a significant endorsement of Canada Nickel’s prospects. With over US$20 billion in annual revenues and a comprehensive suite of services for participants in the precious metals supply chain, Auramet brings substantial industry experience and credibility to this partnership. Their involvement is a testament to the potential seen in Canada Nickel’s projects and their confidence in the company’s management and strategic direction.
In fiscal year 2023, Auramet’s extensive operations included the purchase of over 7 million ounces of gold, 126 million ounces of silver, and 3 million ounces of PGMs. The company has also provided more than US$1 billion in term financing facilities, showcasing its capability and commitment to supporting significant mining ventures. Auramet is actively growing its capital investment business in equity, royalties, and streams within the precious metals and battery-related metals mining sectors, aligning perfectly with Canada Nickel’s ambitions.
This loan facility not only provides Canada Nickel with the necessary funds to advance its projects but also signals a strong vote of confidence from a reputable financial entity. The collaboration with Auramet positions Canada Nickel well to capitalize on the growing demand for nickel in the electric vehicle and stainless steel industries, leveraging its strategic assets and innovative approaches to achieve sustainable growth.
Source: IBN
