Power Nickel Inc (TSX-V:PNPN, OTCQB:PNPNF) said it is planning to raise up to C$45 million to advance work on its Canadian exploration portfolio.
The junior resource company entered into an agreement with BMO Capital Markets and Hannam & Partners to lead a private placement offering, which consists of up to C$37 million in Quebec flow-through shares (FT Shares) and up to C$8 million in hard dollar shares (HD Shares).
Pricing will be set based on market conditions, Power Nickel said in a statement.
Net proceeds from the sale of HD Shares will be used for working capital and corporate purposes, while funds raised from FT Shares will be allocated to qualifying Canadian exploration expenses, the company added.
For investors in Quebec, a portion of the FT Share proceeds will be eligible for additional provincial tax deductions. Power Nickel has committed to renouncing the tax benefits associated with the FT Shares by the end of 2025 and will indemnify investors if it fails to meet that obligation.
The offering is expected to close by the end of the month.
Power Nickel's shares traded higher on the update, adding 7.6% at C$1.69 on Wednesday morning.