Galantas Gold Corp (LON:GAL,CVE:GAL) shares jumped by more than one-third in Toronto on Friday after the company said investor Ross Beaty had increased his common stock stake in the company this week.
The company also announced the closure of an oversubscribed private placement that was announced May 11. The majority of the placement was taken by Beaty.
The Northern Ireland-focused gold mine developer said that on June 9, Beaty acquired 12,825,397 common shares of Galantas by way of a private placement from treasury for a purchase price of 7.875 cents per common share and an aggregate purchase price of $1.01mln.
Prior to the acquisition, Beaty owned, directly or indirectly, or exercised control or direction over 16 mln common shares and 16 mln warrants of Galantas, each warrant entitling the holder to purchase one common share of Galantas. Each warrant is exercisable into one common share until July 24, 2016, at an exercise price of 16 cents per common share.
After the acquisition, Beaty owns 28,825,397 common shares and 16 mln warrants. The 28,825,397 common shares represent approximately 22.9% of the total number of issued and outstanding common shares of Galantas. If all of the warrants were exercised, Beaty would own approximately 31.6% of the issued and outstanding common shares of Galantas.
Beaty's acquisition was made for investment purposes. Beaty may, in the future, acquire ownership and control over additional securities of Galantas for investment purposes.
In addition to the private placement, Roland Phelps, president and chief executive of Galantas Gold, entered into a shares for debt exchange on the same terms as the placement, including the four month hold period, expiring 11th October 2016. Phelps exchanged debt accruing to him, as of 31st March 2016, for C$935,852 for 11,883,835 common shares.
Galantas shares were last seen up 33.3% at C$0.16.