March 19, 2012 / 11:58 AM / in 5 years

UPDATE 1-Nevsun announces share repurchase program

March 19 (Reuters) - Canadian gold miner Nevsun Resources announced a share repurchase program as it tries to restore investor confidence after a recent setback at its flagship mine in Eritrea wiped out roughly halve its market value.

Vancouver, British Columbia-based Nevsun said on Monday that the Toronto Stock Exchange had approved its plan to buy back roughly 4 million common shares, which represent about 2 percent of its issued and outstanding stock.

The purchases may begin no earlier than March 26 and will continue over six months, depending on market conditions, the company said.

Last month, Nevsun said it had overestimated the size of its gold resources at its Bisha mine in the Horn of Africa. Output from the mine is expected to almost halve this year, and the company is conducting a study to recalculate the size of the resource at the site.

Shares of Nevsun, which closed Friday at C$3.30 on the Toronto Stock Exchange, have fallen more than 50 percent since the beginning of February. (Reporting By Euan Rocha in Toronto; Editing by Lisa Von Ahn)

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