Agnico Eagle Takes US$41.1 Million Stake in Radisson Mining

Agnico Eagle Mines (TSX:AEM,NYSE:AEM,OTCPL:AEMRF) is deploying C$57.1 million (US$41.1 million) to acquire a strategic position in Radisson Mining Resources (TSXV:RDS,OTCQX:RMRDF), funding an advanced underground exploration program at the O’Brien gold project in Quebec.

The program requires building an access ramp, surface mine infrastructure, and water management facilities to map out future development scenarios.

“The Advanced Underground Exploration Program that will now commence is designed to extend our understanding of potential mining conditions at O’Brien, including the continuity of mineralization, the geotechnical setting, potential mining methods, and processing criteria,” Radisson President and CEO Matt Manson said.

Concurrently, Radisson is utilizing existing cash reserves to execute an ongoing 140,000-meter step-out drill program.

Through a non-brokered private placement, Agnico will purchase 53.42 million units of Radisson at C$1.07each. Every unit contains one Class A common share and half of a purchase warrant. A full warrant allows Agnico to buy an additional share at C$1.39 at any point over a 60-month period.

Upon closing, scheduled on or around September 2, Agnico will hold a 10.45 percent non-diluted interest in Radisson. That ownership stake increases to 14.9 percent on a partially diluted basis if Agnico exercises the warrants.

The transaction also binds the two companies through an investor rights agreement, where Agnico secures the right to nominate one director to Radisson’s board and maintain its proportional ownership in future equity offerings.

Furthermore, the contract prohibits Radisson from executing specified property transactions, including asset dispositions, streams, royalties, and secured financing agreements, until December 31, 2028.

Agnico recently reported a record US$1.33 billion in free cash flow in Q2, providing a buffer against recent operational disruptions at its Canadian Malartic complex that is also situated in Quebec.

On July 1, a rock mass movement struck the north wall of the Barnat open pit, forcing a total suspension of extraction in that sector.

While Agnico maintained its corporate guidance of 3.3 million to 3.5 million ounces of gold for 2026, the Barnat closure will cut Canadian Malartic’s second-half production by 60,000 to 80,000 ounces.

Regardless of the setback, Agnico continues to pursue its strategy of consolidating domestic supply chains.

The company has invested heavily in Ontario with US$14 billion in capital commitment, which includes US$12 billion slated for existing provincial operations by 2030 plus US$2 billion to develop the Upper Beaver project and expand the Detour Lake open-pit mine.

Shares of Agnico saw a price spike following the news rising to C$305.21, while Radisson Mining surged to an all-time high of C$1.28.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.