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Dundee Precious Metals Increases footprint in Bulgaria with $7 million investment

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(Kitco News) - Dundee Precious Metals is increasing its footprint in Eastern Europe after announcing a $7 million investment in exploration company Velocity Minerals Ltd.

Dundee said that it would buy up to 14 million shares of the junior explorer with its investment. The capital will be used to develop Velocity’s Rozino gold project, which is only 40 kilometers from Dundee’s Ada Tepe mine.

“We are pleased to be investing in further gold exploration in southeastern Bulgaria through our equity financing in Velocity,” said David Rae, president and CEO of Dundee. “Given our strong presence and capabilities in the region, we believe that we are uniquely positioned to support Velocity as a strategic shareholder.”

The investment deal comes less than a week after Dundee Precious Metals announced strong third-quarter earnings. On Nov. 12, the company reported record adjusted net earnings of $51.3 million or $0.28 per share.

Because of higher gold prices and healthy production, Dundee said that it generated $42.3 million in cash flow from operating activities and a record $59.0 million of free cash flow.

Looking at production, the company said that it produced 79,844 ounces of gold in concentrate, “as Ada Tepe and Chelopech continued to deliver strong production and performance.”

Our strong operating results, combined with higher gold prices, generated another quarter of record net earnings and free cash flow as we continue to demonstrate the significant potential of our operating assets,” said Rae in a statement.

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