Fura Gems Inc. recently announced that the non-brokered private placement offering of up to 121,500,000 common shares of the Company for gross proceeds of up to C$30,375,000 that was previously announced on May 15, 2019 (the Offering) has been over-subscribed by Lord of Seven Hills Holdings FZE (Seven Hills). The Company also announced that it has entered into an option agreement to acquire 100% interests in two mining permits (EPM 25973 and EPM 25978) and three mining licences (ML 70419, ML 70447 and ML 70451) (collectively referred to as the Licences) for a sapphire mining project in Queensland, Australia (the Acquisition).

Fura, a new gemstone mining and marketing company already has emerald and ruby assets in Colombia and Mozambique, respectively.

Dev Shetty, President & CEO of Fura, commented: “We are pleased with the response to our capital raise and we believe that securing this funding will significantly accelerate our plans in Colombia and Mozambique and move the Company along the path to revenue generating mining operations. In addition, our anticipated entry into sapphire gemstone mining in Australia represents the final leg of Fura’s journey to hold properties containing deposits of all the big three coloured gemstones (being, rubies, emeralds and sapphires).”

He added: “We believe this approach adds value to both the gemstone industry and our shareholders. Although the sapphire project in Australia is already a producing mine, we intend to more clearly delineate the deposit during the second half of this year and scale-up operations in 2020.”

Fura said that the Company has entered into a subscription agreement with Seven Hills pursuant to which Seven Hills agreed to subscribe for 123,660,000 common shares of the Company at a price of C$0.25 per share for gross proceeds of C$30,915,000. “This represents an increase of 2,160,000 common shares of the Company and an additional $540,000 of gross proceeds. The closing date for the Offering was also extended to August 2, 2019,” Fura stated.

The Company must now obtain disinterested shareholder approval on various counts for the Seven Hills investment to be completed as per regulatory norms.

For this, Fura has set August 2, 2019 as the date on which the Company’s annual general and special meeting will be held. “The Company intends to receive majority support from disinterested shareholders for each New Control Person and the Related Party Transaction at the meeting,” the Company said.  

Fura also indicated that the net proceeds of the Offering are expected to be used for:

1. the advancement of Fura’s Coscuez emerald project in Colombia and ruby assets in Mozambique  
2. the closing of the acquisition first announced on July 26, 2018 of a 100% interest in ruby prospecting licence 5572L in the Montepuez District of Cabo Delgado province in Mozambique  
3. the closing of the merger of ruby assets transaction first announced on July 16, 2018 respecting the Company’s acquisition of (A) 75% of the issued shares of Montepuez Minerals Pty Ltd., which owns a 70% interest in mining licence 5030L, and an 80% interest in mining concession 8921C; and (B) a right to earn a 65% interest in mining concession 8955C under a joint venture agreement, and (ii) general corporate purposes.

“The closing date of the Offering is expected to occur on or about August 2, 2019 and remains subject to receipt of all necessary regulatory approvals, including the approval of the TSXV,” the Company noted. “Fura is not paying any finder’s fees in connection with the Offering. The common shares of the Company issued pursuant to the Offering will be subject to a regulatory hold period of four months and one day.”

Fura has entered into an option agreement dated June 26, 2019 with Richland Resources Ltd (the Agreement) with reference to the Acquisition. The  option is valid until July 31, 2019 and subject to various conditions as laid out in the agreement.