Extorre Gold signs private placement financing deal

7 March 2012 (Last Updated March 7th, 2012 18:30)

Canada's Extorre Gold Mines has signed an agreement to sell common shares to an underwriter for C$25m ($25.1m).

Extorre Gold Mines

Canada's Extorre Gold Mines has signed an agreement to sell common shares to an underwriter for C$25m ($25.1m).

The company will sell 3.53m common shares Canaccord Genuity Corp for $7.12 per share.

The obtained funds will be used for exploration and development of the company's mineral projects in Argentina, as well as for general working capital purposes.

The company said that in connection with this offering, the underwriter will receive a cash commission of 5% of the gross proceeds raised.

The transaction, which is subject to regulatory approvals, is expected to close by next week.

Extorre also announced that it has intersected more high-grade drill results at its Cerro Moro project in the Santa Cruz province of Argentina, particularly on the Zoe target.

The assays related to 83 drill holes at Zoe include MD1434A, which intersected 2.5 metres grading 41.4 grams per tonne (g/t) gold and 2,234 g/t silver, including 108.1g/t gold and 5,812 g/t silver over 0.35m.

Extorre will release its updated preliminary economic assessment (PEA) this month which will include mineral resource estimates for the Escondida-Zoe, Loma Escondida, Gabriela, Nini-Esperanza, Carla and Deborah mineralized zones.

Caption: Extorre Gold Mines' assets include Cerro Moro project in the Santa Cruz province of Argentina. Photo: Courtesy of Extorre Gold Mines.