YA Global Master SPV, a fund managed by Yorkville Advisors, has entered into a GBP3m standby equity distribution agreement with Aim listed Shanta Gold.
Shanta Gold is a gold exploration and development company, engaged in greenfields to advanced exploration in under-explored areas in Tanzania.
Shanta Gold entered into the SEDA as a means of raising additional capital, as and when required, to assist the company with financing exploration and property upgrade activities.
Pioneered eight years ago by Yorkville, a SEDA offers companies a low risk, cost effective way of optimising their capital structure in pursuit of their growth strategy.
The terms of the SEDA enable Shanta Gold, at its discretion, to raise up to GBP3m in tranches in exchange for the issue of new equity, at a discount to the prevailing market price at each drawdown, for up to 30 months from the signing of the agreement. Each tranche is limited to certain agreed restrictions under the SEDA.
Walton Imrie, executive chairman of Shanta, says: “This funding arrangement provides Shanta Gold with flexibility to raise funds efficiently as needed and at increasing valuations as the company moves into its planned production phase.”
Paul Strzelecki, managing director, Yorkville Advisors UK, says: “The SEDA will provide Shanta Gold another very flexible tool in its bag of financing options. The markets in which Shanta operate are particularly exciting at present and we expect the SEDA to assist in capitalising on the opportunities the company faces in the next period.”
