Mining giant Noranda (TSE) will hold on to its remaining 45.7% interest in Hemlo Gold Mines (TSE) after selling a 9.3% stake to an underwriting syndicate by mid-February, said Alan Thomas, senior vice-president of finance.
Led by Burns Fry, Gordon Capital, and RBC Dominion Securities, the syndicate approached Noranda with an offer to buy nine million Hemlo shares and resell them at a secondary offering price of $11. Proceeds of $95 million are expected to improve Noranda’s short-term cash position.
“Basically, we felt the price was right,” Thomas explained. “We don’t see much difference between owning 45% and owning 55%.”
Hemlo recently traded at $10.75.
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