Gryphon Comes Up Short By David Rogers and Cynthia Koons In yet another sign that it’s not easy to find funding these days Down Under, Australia’s Gryphon Minerals had to downsize its capital raising by 7% by lowering the price due to a lack of demand, a person familiar with the matter said. The West-Africa focused gold exploration miner initially set out to raise 63 million Australian dollars (US$62 million) by issuing 45 million shares at A$1.40 apiece but bankers have since lowered the price on the deal to A$1.30, the person said. The money is needed to fund expansion for its flagship Banfora gold project in Burkina Faso. “It’s a sign of the times,” the person said. “It’s very hard to get raisings done in the exploration space in the current market environment.” Gryphon Minerals’ capital raising is due to be completed later Tuesday. Euroz Securities Ltd. and Paradigm Capital are advising Gryphon. The company was also conducting a share purchase plan for up to A$10 million, according to another person familiar with the matter. Currently on a trading halt, Gryphon shares last traded at A$1.50 a share so the discount on the deal is now coming at a 13% discount. It’s not just capital markets making miners lives difficult. European banks have been major providers of trade finance but the ongoing euro-zone debt crisis have prompted them to pull back from that market. While BHP Billiton’s CEO Marius Kloppers says it’s not nearly as bad as it was in 2008, he does acknowledge the financing issues of smaller miners.
GRY Price at posting:
$1.50 Sentiment: None Disclosure: Held
