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OceanaGold to raise C$115.5m in discounted private placement

Tuesday 5th October 2010

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OceanaGold, the gold miner whose chief executive left last month, plans to raise C$115.5 million from a Canadian syndicate of underwriters in a discounted share and warrant issue.

The company has entered into an agreement with Macquarie Capital Markets Canada and Citigroup Global Markets Canada to sell them special warrants and ASX-listed shares at the equivalent price of C$3.50 a share, a discount of 9.1% from its price on the Toronto Stock Exchange. Each warrant will entitle the holder to receive one TSX listed OceanaGold share.

OceanaGold said it plans to use the cash to partially fund an estimated US$140 million worth of development of the Didipio copper and gold project in the Philippines, upgrade the miner's New Zealand operations and meet general working capital requirements.

It's also considering its options to finance the balance of the capital expenditure on the Didipio project, and is in discussions with "a number of parties" as to whether to take on more debt, use internal cash flow or enter into a joint venture.

The offer is expected to close on October 20, and the stock is in a trading halt.

It rose 0.4% to $5.02 on the NZX in trading yesterday, and recently traded at C$3.85 on the TSX and A$3.86 on the ASX.

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