Gascoyne stock falls on discounted capital raising
PERTH (miningweekly.com) – The share price of gold miner Gascoyne Resources on Monday fell by some 48% after it launched an initial A$3.8-million capital raise.
The company told shareholders that it had received firm commitments to place some 77.3-million shares to eligible institutional and sophisticated investors, at a price of 5c each.
Gascoyne last week revealed plans to raise nearly A$28-million through share placement and entitlement offers to strengthen its balance sheet, with the shares offered at half the price of its recent share prices.
Gascoyne on Monday confirmed that it was hoping to raise a further A$20.6-million through a four-for-five non-renounceable fully underwritten entitlement offer. The entitlement offer is fully underwritten by European investor Delphi Undernehmensberatung, unless the shortfall would result in the company holding an interest of more than 19.9% in Gascoyne.
In this case, Delphi’s general sub-underwriting commitment, along with the amount underwritten by the company, would be reduced to the extent required to ensure that its interest in Gascoyne did not exceed the set limit.
The entitlement offer is expected to open on April 10.
Following the share placement and the entitlement offer, Gascoyne could raise an additional A$3-million through a further share placement; however, the miner noted that no decision has yet been made on this top-up placement.
Gascoyne’s share price tumbled to a low of 4.8c a share on Monday, down from a high of 5.7c a share and an opening price of 10c each.
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