Great Basin Raises $130M For Burnside Gold Project

Great Basin Gold (GBG-T, GBG-X) is determined to get its Burnside gold project in South Africa up and running by July 2010 and has completed an equity financing to do it.

It has raised $130 million by offering 100 million units at $1.30 per unit. Each unit was made up of one share and a half warrant. Each full warrant gives the holder the right to purchase a share for $1.60, until Oct. 15, 2010.

Great Basin also granted the underwriters — a syndicate led by BMO Capital Markets and RBC Capital Markets — an over-allotment option. That option can be exercised over 30 days following the offering to purchase up to an additional 15 million shares and/or 7.5 million warrants. If that option is exercised, Great Basin would gain additional proceeds of $19.5 million.

The Burnstone project is in Mpumalanga, South Africa.

In late October 2008, Great Basin subsidiary Southgold was granted a new order mining right allowing it to mine for gold, silver and aggregate.

Great Basin also found a black economic empowerment partner — Tranter Gold — which acquired the required 26% of Burnstone.

At Tranter’s request, the 26% interest in Burnstone was converted to shares in Great Basin, giving Tranter 9.3% of Great Basin and making it the company’s biggest shareholder.

At presstime in Toronto, Great Basin traded at $1.56 per share. The company has a 52-week trading range of 91¢-$3.83 and 216.1 million shares outstanding.