Osisko Development Announces Proposed Offering of US$275.0 Million Aggregate Principal Amount of Convertible Senior Notes

Osisko Development announced a proposed private placement of up to US$275 million in convertible senior notes due 2031. The offering consists of a primary US$225 million tranche, a US$25 million over-allotment option, and a separate US$50 million tranche for affiliated investor Double Zero Capital LP. The notes are general senior unsecured obligations, pay semi‑annual interest, and are convertible at the company’s election into cash, common shares, or a combination. Net proceeds are to fund the Cariboo Gold Project, general corporate purposes, and the purchase of cash‑settled capped call transactions designed to offset potential dilution upon conversion. Interest rate and conversion price will be set at pricing.

The proposed convertible note offering is a material negative. The company already held a staggering $594.3 million in cash and equivalents as of 31 March 2026, after completing a US$143.8 million equity raise and receiving $36.5 million from warrant exercises during the first quarter. The flagship Cariboo Gold Project was already fully financed via an existing US$450 million Appian loan facility (of which ~US$110 million was drawn) and the previous equity infusions. No revised feasibility study or construction update has been provided that would justify an additional $275 million of capital. The sudden need for convertible debt—especially when the stock has fallen 38% from its March high of $6.53—signals either unanticipated cost overruns, a widening funding gap, or a worrisome change in management’s capital‑discipline. Convertible notes introduce both incremental debt service and, if converted, substantial dilution; the capped call transactions only partially mute the equity hit. For a company that has already heavily diluted shareholders through multiple equity and warrant‑based raises, this unexpected offering adds further uncertainty and overhang.

Osisko Development Corp. is a gold development company focused on its 100%‑owned, fully‑permitted Cariboo Gold Project in central British Columbia. A June 2025 feasibility study outlined probable reserves of 2.07 Moz Au (17.8 Mt @ 3.62 g/t), a 10‑year mine life, average annual production of 190 koz, and an after‑tax NPV₅% of $943 M (base case US$2,400/oz gold). The company also operates a small‑scale heap‑leach at Tintic in Utah, sold the non‑core San Antonio project, and holds passive stakes in Niobay Metals and Falco Resources.