Precious metals mining company Goldcorp Inc. (GG, G.TO) said Monday that it is planning a private offering of about US$750 million of convertible senior notes due 2014.
The company further noted that it intends to grant initial purchasers or underwriters a 30-day option to purchase up to an additional US$112.5 million of notes, to cover over-allotments, if any.
The Vancouver, Canada-based Goldcorp plans to utilize the net proceeds to repay its debt under revolving term credit facility. The remaining of the proceeds will be used for general corporate purposes, including capital expenditures, the company noted.
Even though the company has not established the terms of the offering, it is expected that the price for converting the notes into the company's common shares will be set at a premium to the market price of Goldcorp common shares. Also, the holder's right to convert will be subject to the company's shares trading at a premium to such conversion price or upon the occurrence of certain other events.
Instead, Goldcorp may decide to pay or deliver cash or a combination of cash and common shares, in respect of the converted notes.
The company said that the notes and the common shares issuable upon conversion of the notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act of 1933, as amended.
Goldcorp added that the offers and sales of the notes in Canada will depend upon exemptions from the prospectus requirements of applicable Canadian provincial or territorial securities law.
Goldcorp is a leading gold producer engaged in gold mining and related activities including exploration, extraction, processing and reclamation. The company said its operating assets include the Red Lake, Porcupine and Musselwhite gold mines in Canada, the El Sauzal, Los Filos and San Dimas gold/silver mines in Mexico, the Marlin mine in Guatemala, the Marigold mine, where it has 67% interest and Wharf mine in the United States and the Alumbrera mine, with 37.5% interest, in Argentina. Goldcorp noted that over 70% of its reserves are in low political risk NAFTA countries.
Shares of Goldcorp are currently trading at $39.54, down $0.19 or 0.48%, on a volume of 84 thousand shares.
G.TO trades at C$43.23, up 0.19% on 96 thousand shares.
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