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McEwen raising $40.5 million to acquire Timmins property

McEwen Mining is in the process of acquiring the Black Fox Complex and Grey Fox Mine from Primero Mining.
Underground mining at Black Fox Mine started in 2011. The mine is expected to produce between 50,000 and 60,000 ounces of gold in 2017.

McEwen Mining has struck an underwriting agreement to raise $40.5 million in capital for the previously announced acquisition of the Black Fox and Grey Fox mining properties outside of Timmins.

Under the agreement, a syndicate of underwriters will purchase 18 million shares of McEwen common stock and warrants to purchase up to nine million shares of common stock to raise the funds.

The agreement is expected to close on Sept. 22.

McEwen announced its intention to purchase the properties, currently owned by Primero Mining, in August.

The Black Fox Mine Complex includes the Black Fox Mine, the Black Fox mill, the Grey Fox development project, and the Pike River exploration property.

Commercial production from the Black Fox open pit mine began in May 2009 (depleted in September 2015) and underground mining commenced in October 2011. Primero acquired the Black Fox Complex following a takeover of Brigus Gold Corp., which was completed in March 2014.

In 2017, Black Fox Mine is expected to produce 50,000 to 60,000 ounces of gold.