New Gold Inc. (USA) (NYSEMKT:NGD) has announced closing its bought deal financing of 61,640,000 common stock. The company plans to use the proceeds from the offering to fund the construction of the Rainy River gold project situated in Ontario, Canada
The company made the offering through a group of underwriters including Scotiabank, RBC Capital Markets, CIBC Capital Markets, TD Securities Inc, J.P. Morgan, Merrill Lynch Canada Inc, BMO Capital Markets, National Bank Financial Inc. Credit Suisse Securities ( Canada ) Inc, GMP Securities L.P and Eight Capital.
The company completed the offering in way of short form prospectus in all the territories and provinces of Canada. The offering was further registered in the United States in accordance to a registration statement on Form F10 as per Multijurisdictional Disclosure System established between the United States and Canada.
New Gold is gold mining company with a portfolio of two significant development projects and four producing assets. Among the company’s projects are the Mesquite Mine in the United States, the New Afton Mine in Canada, the Cerro San Pedro Mine in Mexico and the Peak Mines in Australia. All these projects offer the company with a production base. Additionally, the company owns 100% stake in the Blackwater and Rainy River projects situated in Canada. The company’s main mission is become the world’s leading gold producer that is focused on the environment as well as social responsibility.
In other segments, the company has trimmed its share price target to $3.60 from the previously set target of $4.30 by CIBC. The brokerage however maintained the stocks neutral rating. The adjustments were made to reflect lower spot prices in addition to accommodating certain risks related to the Rainy River delivery.
The brokerage started its coverage on the company’s shares after the closure of an equity issue on March 10. New Gold has raised around $173 million from the issue of 61.65 million shares.
According to analyst Terry Tsui and David Haughton, the money raised will help in filling the funding gap for the construction of the Rainy River construction.