January 22, 2014 / 1:28 PM / in 5 years

Timmins Gold to raise C$25 mln selling shares to bank syndicate

TORONTO, Jan 22 (Reuters) - Timmins Gold Corp, which owns the San Francisco gold mine in Mexico, said on Wednesday it had agreed to sell C$25 million worth of equity to a syndicate of banks as it seeks to strengthen its balance sheet.

The syndicate led by RBC Capital Markets will buy the shares at a price of C$1.50 per common share, a 13.3 percent discount to Timmins’ closing price of C$1.73 on the Toronto Stock Exchange on Tuesday. The transaction was done as a bought deal.

A bought deal occurs when an underwriter, or a syndicate, buy shares from an issuer before selling them to the public. The deals typically occur at a slight discount to a company’s last trading price.

The company said proceeds will be used for general corporate purposes, including repayment of debt and working capital needs.

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