TORONTO (miningweekly.com) – Canada's second-biggest gold-miner Goldcorp is planning a private offering of about $750-million worth of convertible senior notes due in 2014, the firm announced on Monday morning.

The company also expects to give the initial purchasers in the offering a 30-day option to buy up to another $11,2-million of notes to cover any over-allotments.

Goldcorp intends to use the net proceeds from the sale of the notes to repay indebtedness under its revolving term credit facility, with the balance to be used for general corporate purposes, including capital expenditures, it said.

The terms of the offering have not been established, but Goldcorp expects that the price at which the  notes will be convertible into Goldcorp common shares will be set at a premium to the market price and that a holder's right to convert will be contingent on Goldcorp common shares trading at a premium to the conversion price.

The firm will also have the right to elect to pay cash or a combination of cash and shares on conversion, instead of purely shares, which gives the company a measure of control over potential dilution of its stock as a result of the offering.

Last week, CEO Chuck Jeannes said in a presentation last week that the company did not plan to issue equity to raise finance.

Goldcorp, which has mines in Canada, Argentina, the US, Mexico, Honduras and Guatemala, expects to increase total production by more than 50%, to 3,5-million ounces by 2013.

Shares in the company fell 5,1% on Monday, to C$40,95 apiece by 16:10 in Toronto.

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