Legendary precious metals investor Eric Sprott, is reducing his stake in Sprott Inc.
, Stock Forum
), the asset management firm he launched nearly three decades ago.
Sprott said Tuesday, he is selling 25 million shares in Sprott at $3 a share.
On Wednesday, the stock was down 8% to $3.01 leaving a market cap of $747.5 million, based on 248.3 million shares outstanding. The 52-week range is $3.85 and $2.21.
Sprott said that 2176423 Ontario Ltd., a company controlled by Sprott has struck a deal with a syndicate of underwriters co-led by TD Securities Inc. and Scotiabank.
Under the deal, the underwriters will purchase from the selling shareholder 20 million common shares of Sprott at $3 per share, generating $60 million in gross proceeds, the company said in a press release.
The underwriters have been granted an over-allotment option to purchase an additional three million shares at the issue price. That option is exercisable for a period of 30 days after the date that the offering closes.
Concurrent with the offering, Eric Sprott intends to enter into an agreement to sell, on a non-brokered private placement basis five million shares at the issue price to the Sprott Inc. 2011 Employee Profit Sharing Plant Trust.
Sprott Inc. will not reveive any proceeds from the offering or private placement. All proceeds will be payable to Eric Sprott, who intends to use the net proceeds to invest in funds and securities managed by Sprott or its affiliates, with a focus on precious metal-related investments.
Following completion of the offering and the private placement, Sprott will retain a 25.4% stake in Sprott Inc. and 24.2% if the over-allotment option is exercised in full.