- Gold miner Resolute (RSG) has entered a trading halt after announcing a $196 million raise
- Raised funds be used to pay off debt from buying the Toro gold project in Senegal
- The West African-based project was purchased last July, and its flagship mine holds over one million ounces of gold
- Institutional investors and company directors will raise the majority of funds
- Resolute's last closing price is $1.18 per share
Gold miner Resolute (RSG) has entered a trading halt this morning as it prepares for a $196 million raise.
Raised funds will be used to pay off a $189.5 million (US$130 million) debt accumulated after purchasing the Toro gold project in Senegal, West Africa.
The Toro project was purchased last July for nearly $400 million (US$274 million). Toro's flagship mine Mako has an estimated mineral resource of 1.24 million ounces of gold. Average annual production at the mine is expected to be 140,000 ounces.
Institutional investors will have the opportunity to participate in a $146 million placement, while Resolute directors and major shareholders will raise $25 million. Additionally a share purchase plan will be open to eligible shareholder to raise a further $25 million.
Following the financial raise, Resolute will pay off its debt earlier than initially set out.
"The ability to entirely repay the Toro Gold acquisition facility will save Resolute extension fees and interest payments," company CEO and Managing Director John Welborn said.
This will allow the gold miner to completely refinance its debt facilities for the quarter too.
Before entering the trading halt, Resolute's last closing price is $1.18 per share.