Zijin Mining to take 9.9% stake in Montage Gold
As part of the deal, the Lundin Family Trust also agreed increase its stake in the company from 17.7% to 19.9%.
Rubicon Minerals stocks were diving this morning (TSE:RMX) (AMEX:RBY) close to 5 per cent as the Canadian company said Monday that it has agreed to a $200.9 million bought deal financing, with funds to be used for the development of its Phoenix gold project in Red Lake, Ontario (in the photo).
The offering, with a syndicate of underwriters co-led by GMP Securities and TD Securities, will consist of 49 million Rubicon common shares at a price of C$4.10 each, for total proceeds of $200.9 million.
The underwriters will also have the option to purchase up to an additional 7.35 million shares, boosting the total proceeds to up to C$231.035 million. This option is exercisable in whole or in part at any time up to 30 days after the offering’s close, said Rubicon.
The Vancouver-based miner controls over 100 square miles of prime exploration ground in the prolific Red Lake gold district of Ontario.
In December, Rubicon announced that the Ontario Ministry of Northern Development and Mines has approved its closure plan, meaning further construction of the mine can proceed.
President and CEO David Adamson called the approval a “significant milestone” considering the initial discovery was made only three and a half years ago.
Three more permits are still remaining, and those are expected to be granted by the end of 2012 says Rubicon. The mine would begin producing in 2013.
Agnico-Eagle, a gold producer with three mines in Quebec, as well as the Canadian territory of Nunavut, Finland and Mexico, paid $70 million in July for a 9.2% stake in Rubicon Minerals.
The capital injection was intended to be used by Rubicon for exploration drilling and other development work at Phoenix, which is estimated to contain 477,000 indicated ounces of gold graded at 14.5 g/t, and 2.3 million ounces inferred at 17 g/t.
The deposit is in close proximity to Goldcorp’s Red Lake mine, Canada’s largest gold mine and one of the world’s richest gold mines and lowest cost producers.
Rubicon Minerals Corporation is engaged in exploration, development and mining of natural resource properties with a focus on prospective gold areas of North America.
