A strong performance recently by the yellow metal has prompted at least two gold-producers to announce new financing.
Cash-strapped MinVen Gold (TSE), which has been burdened by heavy debt and low gold prices, plans to raise at least US$10 million through an underwriting of promissory notes.
Proceeds from the private placement will be frozen until other steps are taken in MinVen’s capital restructuring. As of Dec. 31, 1992, the company had a working capital deficit of $23.1 million.
If Minven’s plan of arrangement is approved, the promissory notes would be exchanged into units at an exercise price of US$1.50 per unit. At the other end of the scale, cash-rich Euro-Nevada Mining (TSE) is aiming to become even richer with the issue of two million special warrants at $25 per warrant.
Each special warrant will be convertible into a common share and share purchase warrant. Two warrants will be exchangeable for one common share of the royalty-holder at $32 per share.
Gold has jumped about US$15 to US$350 in recent weeks.
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