Perth-based precious metals explorer Dragon Mining NL hopes to raise $30.9 million through a non-renounceable rights issue, with plans to use the funds to close out its hedge book.
The full text of a company announcement is pasted below
Dragon Mining Limited ("Dragon" or "Company") is pleased to announce a non-renounceable rights issue to all Eligible Shareholders and Noteholders of New Shares at an issue price of A$0.115 (11.5 cents) per New Share to raise up to A$30,974,337 before underwriting fees and expenses of the issue.
The principal purpose of the raising is to enable the Company to close out the 80,000 ounces of the hedge book which remains from the initial financing of the Svartliden Mine in Sweden, established in November 2003. The Board believes positioning the Company as an unhedged gold producer will provide all Shareholders with an exposure to any upturn in the gold price in the future and provide the Company with the additional cash flow it requires to evaluate further its extensive and highly prospective exploration portfolio in Finland.
Eligible Shareholders and Noteholders, who are on the share register at the Record Date of 14 August 2007, will be entitled to participate in this rights issue. Each Eligible Shareholder will be entitled to purchase one New Share in the Company for every two shares held. Each Eligible Noteholder will be entitled to purchase one New Share in the Company for each Note held.
Dragon has received great support from its major shareholders who have fully underwritten the Shareholder Offer of $28.25 million.
