(Alliance News) - Gunsynd PLC on Thursday said it has invested around CAD350,000, about GBP207,000, into junior gold development and exploration company 1911 Gold Corp.
The London-based company investing in companies and projects within the natural resources, life sciences and beverage sectors said 1911 Gold is based in Manitoba, Canada and "in the heart of" the Rice Lake gold district within the West Uchi greenstone belt.
The investment was made via a subscription for 5.8 million 1911 Gold shares at CAD0.06 each, with payment coming from Gunsynd's existing cash resources.
For each 1911 Gold share subscribed for, Gunsynd has received a warrant over a new share with an exercise price of CAD0.10 per share, exercisable for two years from the date of closing of the offering by 1911 Gold.
Shares in 1911 Gold closed up 6.7% at CAD0.080 in Toronto on Wednesday, giving the company a CAD5.5 million market capitalisation.
Gunsynd said its investment was part of the CAD3.9 million private placement recently announced by 1911 Gold, with the financing receiving a lead order from renowned precious metals investor Eric Sprott.
Following the investment, Gunsynd will have a 4.3% stake in 1911 Gold.
"It is very exciting to have secured a position in a gold development and exploration opportunity such as 1911. Its not often you can invest into a company that owns a mill and mining complex, 1m ounces at an attractive grade of 6.4 grammes per tonne and a vast portfolio of exploration tenure along strike in a first world mining jurisdiction all for a very modest market cap of CAD5 million," said Gunsynd Non-Executive Director Peter Ruse.
"Gunsynd was very pleased to be investing alongside well renowned gold investor Eric Sprott who corner stoned the CAD3.9 million fundraise. This only strengthens our confidence of the potential upside and value creation amongst a backdrop of record gold prices"
Shares in Gunsynd last traded at 0.18 pence each in London on Wednesday morning.
By Greg Rosenvinge, Alliance News senior reporter
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Gunsynd (GUN)