Baru Gold Completes Shares For Debt Transaction
Baru issued equity to settle debt, highlighting a critical cash shortage at its Indonesian mining operations.
Baru Gold Corp. has completed a debt settlement transaction with Mercer Street Global Opportunity Fund LLC, an arms' length lender. The company settled $713,258.55 of outstanding debt by issuing 14,265,171 common shares at a deemed price of $0.05 per share.
The issuance partially settles a convertible loan agreement originally dated July 15, 2022, and amended on July 10, 2026. The transaction follows the July 22, 2026 announcement of the same deal and the July 16, 2026 forbearance agreement, which included the issuance of 6,528,879 bonus warrants.
The issuance is subject to TSX Venture Exchange approval, and all newly issued securities carry a four-month hold period.
Baru Gold Corp. (BARU) executed a debt-to-equity swap that provides zero incremental cash to the company. With a reported cash balance of $42,194 and a $7.77M working capital deficiency, the move serves as a necessary survival tactic rather than a strategic growth initiative. The issuance of approximately 14.3M shares represents about 3.7% dilution to the existing share base of roughly 379.4M. The deemed price of $0.05 aligns with the recent trading range, indicating no premium was paid to the lender and reflecting the market's pricing of the company's liquidity risk. This is a routine financing action for a pre-revenue junior miner with depleted cash reserves and does not alter the fundamental risk profile or catalyze immediate production.
Baru Gold Corp. is a Canadian junior mining company focused on the Sangihe Gold Project in North Sulawesi, Indonesia. The company holds a 70% interest in the project through its subsidiary PT Tambang Mas Sangihe (TMS). The project covers approximately 25,000 hectares, with a 65-hectare area targeted for initial production.
A NI 43-101 technical report outlines resources of more than 200,000 ounces of gold, comprising 114,000 ounces indicated and 91,000 ounces inferred, along with more than 3,000,000 ounces of silver. The company plans to proceed to production without establishing mineral reserves or completing a feasibility study, acknowledging significant technological and economic risks. Environmental permits are secured, and the project is classified as a "National Vital Object" by the Indonesian government.