MANILA, Philippines - Lepanto Consolidated Mining Co. has obtained the Securities and Exchange Commission’s nod to raise its authorized capital from P3.35 billion to P6.64 billion.
Lepanto said the increase in capitalization was supported by the recent stock rights offering, which raised around P3 billion for the company.
Lepanto offered a total of 10.05 billion common shares to its stockholders at a ratio of one new common share for every 3.3 common shares at 30 centavos apiece.
Proceeds from the issue will be used to fund the development of the company’s Victoria mine in Benguet province as well as pay down loan obligations.
Lepanto is also setting aside a portion of the proceeds for payment of accounts with suppliers and advances from shareholders.
The development of the Victoria reserve is expected to result in the expansion of Lepanto’s gold production to 40,000 ounces this year.
Lepanto also owns 60 percent of Far Southeast Gold Resources Inc., another mining company with resources in Mankayan, Benguet. Last month, Lepanto granted South Africa-based Gold Fields Switzerland Holdings AG (GFS) an 18-month option to acquire one-third of its stake in Far Southeast.
GFS, a wholly-owned subsidiary of Gold Fields Ltd., plans to acquire a total of 60 percent interest in Far Southeast from major shareholders Lepanto and Liberty Express for $340 million. The option requires GFS to solely fund pre-development expenses, including exploration and a feasibility study, of the project and contribute $110 million into Far Southeast Gold.