Vizsla Silver Shares Slide on $250M Convertible Notes Offering

Vizsla Silver (VZLA) fell 12% after announcing the pricing of a US$250 million offering of convertible senior unsecured notes due 2031, including a potential US$50 million overallotment option for initial purchasers.

Key Terms of the Convertible Notes

Principal amount: US$250M
Overallotment option: Additional US$50M
Maturity: 2031
Interest: 5% semi-annual cash payments
Initial conversion rate: 171.3062 shares per $1,000
Implied conversion price: ~$5.84 (25% premium to prior close)

These terms position the notes as a funding mechanism that may introduce future share dilution.

Expected Use of Proceeds

Vizsla expects net proceeds of:

~US$239.4M (without overallotment)
~US$285.9M (with overallotment exercised)

Funds will be allocated toward:

Advancing the Panuco Project
Future acquisition opportunities
General corporate purposes
Cash-settled capped calls aimed at reducing dilution from note conversion

Market Reaction

Shares declined as investors weighed the dilutive potential of the offering despite strengthened liquidity and long-term project funding.