Shares of Aurizon Mines (TSX: T.ARZ, Stock Forum) fell 9% to $5.13 Wednesday, after the company announced that it has entered into an agreement with a syndicate of underwriters, who have agreed to purchase 9.7 million common shares of the company at $5.15 per share.
The financing is expected to raise gross proceeds of more than $50 million.
The company says net proceeds of the offering, which is expected to close around April 29, will be used for working capital, potential acquisitions, and general corporate purposes.
Aurizon is focused on developing its projects in the Abitibi region of north-western Quebec.
On the company’s Bullboard, yorkmemo said:
This deal was bought by National bank at $5.15, there's no way the bank will allow the shares to drop much below the purchase price, and as such I suspect that this is where ARZ will stay for a bit. The dilution doesn't bother me at all considering its only 10 mill shares being issued. The big 10% drop will attract bargain hunters though, so I believe there will be a bit of a bounce in the share price today before close, especially if gold remains positive/neutral[sic]
Looking for more info on Gold and Silver investment opportunities? Check out the Stockhouse Gold & Silver Feature Supplement