Cora Gold Limited (LON:CORA) Chief Executive Officer Bert Monro caught up with DirectorsTalk to discuss the company’s fundraising and the strategic investment from Eagle Eye to advance the Sanankoro Gold Project in Mali towards construction and production.
Q1: In addition to bringing an impressive quantum of funds, the fundraise brings in a significant strategic investor in Eagle Eye. What specifically differentiated Eagle Eye from other potential funding partners do you think and what do they bring to Cora Gold beyond capital?
A: It’s been obviously great to get this announcement out today and great to have Eagle Eye coming on as a shareholder after the GM closes.
Eagle Eye are already significant investors across Africa, but significantly in Mali. They’re the significant investor in a group called Toubani, which is an ASX listed company, which has recently received its mining permit under the new code in Mali and are looking to move into construction very soon.
So, I think there’ll be a really useful strategic partner, both with, I guess, operational capabilities across Africa and also a deep rooted knowledge in Mali as well.
Q2: Now, the issue price represents a sizeable discount to the market. How should shareholders think about that discount in the context of de-risking Sanankoro and accelerating the path to production?
A2: We raised money in December, a few weeks ago, at 6p a share. Obviously, we’ve been in discussions with Eagle Eye for a number of months and ultimately, the price is at the same price that we raised money at very recently in the middle of December.
I appreciate it is a significant discount, but I think when you’re bringing in a strategic investor for a significant quantum of money and obviously also touching on potentially a fully funded solution as well to the project as well, I guess you’ve got to look at it in the context of the whole.
I think additionally, we’ve obviously earmarked a £2 million retail offer at the same price on the same terms alongside it to obviously try and manage that pricing situation as well.
Q3: Looking at Sanankoro today, what are the final technical and regulatory milestones investors should be watching before construction can begin?
A3: It’s all about the permit really. We’ve got the environmental permit already, we’ve obviously completed our feasibility study, and we’ve got a project team in place. So really, it’s about getting this permit and then getting on with construction.
Q4: You hinted that Eagle Eye has referenced discussions around a fully funded project finance solution. Could you just explain what that might look like for Sanankoro, and what it would mean for equity dilution going forward?
A4: Obviously, I’m limited to how much I can say. Aryann Gupta, the proposed new non-exec director of Cora Gold and the Eagle Eye representative, referenced it in his quote, we’re obviously in discussions around a fully funded project finance solution. I’ll probably lead people to potentially look at Toubani, where obviously Eagle Eye put in equity, but then they also put in a non-equity financing piece to fully fund it, which was a blend of debt and a stream as well for Toubani.
So, obviously, we’re in discussions. Nothing’s been agreed yet. With Toubani, they put in a fully financed solution, having put in the equity first so I guess in terms of listeners and watchers to eventually have a look at that, to get an idea of what it might look like.
Q5: Now, following the completion of the fundraise, Eagle Eye would hold close to 30% of the company and they’d also have Board representation. How does the relationship agreement ensure alignment while protecting minority shareholders?
A5: As you said, they are due to be 29.9% shareholder once the shares are issued, post the general meeting, and as you said, we’re due to be signing a relationship agreement with them.
It’s a fairly standard procedure. Obviously, the Quirk family, represented currently as significant shareholders of the company are also in a relationship agreement as well. It just manages that relationship to make sure that the business of the company can carry on as normal. They can’t act in a way that would stop us from going about ordinary business of the company.
So, it’s a fairly standard thing to have in place. We’ve obviously already got one in place with our current significant shareholder.
Q6: Finally, Bert, just looking ahead, 12-18 months, what do you think is on the horizon for the company in terms of both Sanankoro and also Madina Foulbé?
A6: I hope in 18 months’ time we’ll be significantly through construction and looking towards the first gold bar at that time. Our construction timeline is 18 months really from when we get digging so that’s a really exciting prospect in the future. Obviously, that’s for Sanankoro.
Madina Foulbé you mentioned there as well, that’s our asset in Senegal. We had a really nice looking drill discovery there last year. Hopefully, we’ll be able to do further exploration there as well and look to develop that asset over the next 18 months, as I said, it’s much earlier stage, pre-resource. We’ve got that really exciting period from exploration potential where you’ve drilled out a discovery, and I guess you still need to discover how big that discovery might be and what it might look like with more drilling.
