Credit Suisse maintains outperform rating on Perseus after A$102m equity raise
JOHANNESBURG (miningweekly.com) – Financial services group Credit Suisse has maintained its outperform rating and A$0.72 a share price target on West African gold producer Perseus Mining following the company’s A$102-million equity raise.
The A$102-million raise at $0.50 a share, which comprised a $A61-million institutional placement and a A$41-million nonrenounceable entitlement offer, would be used to fast-track Perseus’s growth strategy including construction of its Sissingué project and definitive feasibility study (DFS) at its Yaouré project, both in Cote d'Ivoire.
Perseus was currently trading at A$0.565 a share and would come out of trading halt on Thursday.
The company has also mandated Macquarie Bank and BNP Paribas to provide a $60-million debt facility to be applied to the development of Sissingué.
Credit Suisse analyst Michael Slifirski said this left Perseus’ operating Edikan gold mine, in Ghana, Sissingué and Yaouré “comfortably funded” and underpinned a multi-mine strategy for the company.
Slifirski highlighted that while Edikan would remain cash-neutral in the 2017 financial year, strong cash generation from the 2018 financial year was expected.
“Sissingué’s development is no, or soon will be, fully funded, independent of Edikan. If it is delivered on budget and performs to plan, it should rapidly repay its debt and generate a satisfactory return, contributing to the future funding of Yaouré,” said Slifirski.
Perseus MD and CEO Jeff Quartermaine said the equity raising allowed Perseus greater balance sheet strength and flexibility.
“The successful completion of the equity raising and finalising debt financing for Sissingué will provide Perseus with the ability to implement our growth strategy.
“Perseus has the opportunity to transform from a company with a single producing gold mine in Ghana into a diversified West Africa-focused miner with two producing operations, a very high quality development project in Yaouré gold project and further exploration potential.
“The equity raising will also provide us with the balance sheet flexibility to accelerate exploration and completion of the DFS at the Yaouré gold project. Following completion of construction at Sissingué, we expect to be in a position to fund further growth initiatives through a combination of internal cash flows and/or future debt.”
Perseus’s Sissingué project was expected to start production in December 2017, while the Yaouré DFS was targeted for mid-2017.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation