VANCOUVER - Endeavour Silver Corp . (NYSE: NYSE:EXK; TSX: EDR), a mid-tier precious metals company, has announced an agreement with a syndicate of underwriters led by BMO Capital Markets to purchase 15,825,000 common shares at a price of US$4.60 per share, aiming to raise approximately US$73 million. The transaction is structured as a bought-deal offering and is expected to close on or about November 27, 2024, pending necessary regulatory and stock exchange approvals.
The underwriters have been granted an over-allotment option, exercisable within 30 days post-closing, to purchase up to an additional 10% of the common shares offered. Endeavour intends to utilize the net proceeds primarily for general working capital and to advance the Pitarrilla Project, a cornerstone development in its mining portfolio.
The offering will be available in all Canadian provinces, except Quebec, under a short form base shelf prospectus and a prospectus supplement. In the United States, the offering will be made available through a prospectus supplement to a base shelf prospectus included in the company's registration statement on Form F-10 as part of the Multi-Jurisdictional Disclosure System between the United States and Canada.
Investors can obtain copies of the final base shelf prospectus and any applicable shelf prospectus supplement from BMO Capital Markets. The documents will be filed with Canadian and U.S. securities commissions within two business days and will be accessible through SEDAR+ in Canada and EDGAR in the United States.
The company has emphasized that the common shares may also be offered on a private placement basis in certain jurisdictions outside of Canada and the United States, subject to applicable laws and without any sale in locations where such an offer would be unlawful.
This news is based on a press release statement from Endeavour Silver Corp., which operates with a commitment to sustainable and responsible mining practices. The company, with a presence in Mexico and a portfolio of exploration projects in Mexico, Chile, and the United States, aims to establish itself as a premier senior silver producer.
In other recent news, Endeavor Group Holdings has agreed to sell its OpenBet and IMG Arena businesses to OB Global for approximately $450 million. This transaction is a crucial step in anticipation of Endeavor's upcoming take-private deal led by private equity firm Silver Lake. OB Global plans to fund the acquisition through a mix of cash and debt, with Jordan Levin maintaining his leadership role at OpenBet post-sale. Endeavor is also actively seeking a buyer for IMG Arena.
In parallel, TKO Group Holdings has announced a $2 billion stock buyback plan and an agreement to purchase select sports assets from Endeavor Group Holdings for $3.25 billion. Both deals are subject to regulatory approvals and closing conditions.
Furthermore, Endeavor has initiated a strategic review that may lead to the sale of several assets, including the Miami Open and Madrid Open tennis tournaments and the Frieze art platform. Endeavor has secured a $175 million margin loan agreement and declared a quarterly cash dividend of approximately $27 million for its Class A common stockholders. These are the latest developments in the companies' financial activities.
InvestingPro Insights
Endeavour Silver Corp.'s recent announcement of a US$73 million bought-deal offering comes at a time when the company is trading near its 52-week high, as indicated by InvestingPro data. This positioning may have contributed to the company's decision to raise capital, potentially capitalizing on favorable market conditions.
InvestingPro Tips reveal that Endeavour Silver (TSX:EDR) operates with a moderate level of debt, which aligns with the company's strategy to raise funds for working capital and project development. The planned use of proceeds for the Pitarrilla Project demonstrates the company's focus on growth and expansion.
It's worth noting that while Endeavour Silver has shown strong revenue growth, with a 66.6% increase in quarterly revenue as of Q3 2024, the company's profitability metrics present a mixed picture. An InvestingPro Tip indicates that analysts predict the company will be profitable this year, which could be a positive sign for investors considering the recent share offering.
The company's price-to-earnings ratio (adjusted) of 64.56 suggests that investors are pricing in future growth expectations, possibly related to projects like Pitarrilla. However, potential investors should be aware that the stock is trading at a high earnings multiple, which may indicate higher risk or expectations of significant future earnings growth.
For readers interested in a more comprehensive analysis, InvestingPro offers 8 additional tips for Endeavour Silver Corp., providing a deeper understanding of the company's financial health and market position.
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