LATIN American miner Minera is hoping to raise up to C$32m (£20m) in a share placing for the development of its Ollachea gold project in Peru, it announced yesterday.
The offering will be marketed in Canada, the UK, the US and in certain jurisdictions in South America on a private placement basis.
The Ollachea project in Puno, southern Peru, is in a highly prospective area, according to Minera. The gold producer completed a feasibility study on the project at the end of last year, and it is currently in the permitting stage.
The funds raised will be used to develop the project, and will be spent on engineering costs and to advance the exploration tunnel.
The expected capital expenditure for the project is $177.5m (£112.9m), and full production at Ollachea is expected to begin the first half of 2015.
The placing will be held through a syndicate of investment dealers led by RBC Capital Markets as sole global bookrunner.
Assuming the placing is a success, it will be the second equity raise by Minera in the past year, following the $33m raised last March.
The Latin American producer currently produces around 35,000 ounces a year from its open mine, the Corihuami mine in Peru.
Shares in Minera sank yesterday on the news to close down 4.76 per cent at 50p.
ADVISERS RBC CAPITAL MARKETS
RBC CAPITAL MARKETS
As well as being co-broker on the placing, RBC Capital Markets is also acting as the sole global bookrunner on the transaction.
Martin Eales, European ECM and corporate broking managing director at RBC Capital Markets led the team on Minera’s placing. The team also included colleagues Stephen Foss and Richard Hughes.
Martin Eales joined RBC in 2006 from Collins Stewart, though he has been advising AIM and main market companies on takeovers and listings since 1998. He became the corporate finance director at Westhouse Securities in 2004, after helping transform the business from its previous guise as Brown, Shipley & Co.
In the past, Eales has advised several natural resource players including Petra Diamonds, Aureus Mining and Pan African Resources.
Eales was involved in RBC’s role as joint broker to AIM-listed oil and gas explorer, Chariot Oil & Gas, which purchased an offshore exploration licence from the Moroccan government in October last year.
The director also advised Allied Gold on its acquisition by Santa Barbara, which was completed in August last year.
RBC has a long track record of fundraising in the mining sector, having secured the role of joint corporate broker for FTSE 250 mining firm African Barrick Gold in August 2011.
On this particular deal with Minera, Jennings Capital, Fraser Mackenzie, Desjardins Securities, Canaccord Genuity and finnCap also worked on the offering.
Canaccord Genuity is the nominated adviser and broker for Minera in London, where Andrew Chubb and Sebastian Jones worked on the team. FinnCap is the co-broker in London, where Geoff Nash, Matthew Robinson and Elizabeth Johnson were involved with the placing.