June 10, 2011 / 1:29 PM / 7 years ago

UPDATE 2-Nautilus withdraws proposed equity offering; shares up

* Had planned to raise about C$150 mln

* Says has other options for raising capital

* Shares up 16 pct in early trading on the TSX (Adds share price move. In U.S. dollars unless noted)

TORONTO, June 10 (Reuters) - Nautilus Minerals Inc (NUS.TO), which plans to mine copper from the ocean floor, said on Friday it has shelved plans to raise C$150 million ($153 million) in an equity offering due to adverse market conditions.

The Toronto-listed company said it made the decision despite a positive response from investors when it was marketing the proposed offering.

Nautilus announced the offering on May 24. It said at the time it would use the proceeds to develop its Solwara 1 project, off the coast of Papua New Guinea in the Pacific Ocean. The offering was to be conducted by a syndicate of underwriters led by TD Securities and Credit Suisse.

Some of the cash from the offering had also been earmarked to fund the production support vessel required at Solwara 1.

“While it is disappointing to withdraw the capital raising, we did not believe shareholders would be best served by issuing stock in the current market conditions,” Chief Executive Steve Rogers said in a statement.

“We have a strong cash position and a range of alternative options available to access capital in the future,” Rogers said. “Nautilus continues to advance its first project at Solwara 1.”

Nautilus is expected to release its first-quarter financial results early next week. The company said it had a cash balance of about $140 million as of March 31, and no debt.

Shares of Nautilus jumped 16 percent to C$2.62 in early trading on the Toronto Stock Exchange on Friday.

$1=$0.98 Canadian Reporting by Euan Rocha; editing by John Wallace and Peter Galloway

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