big cap raise looms for gry -300million

Might be a huge dilutive event count be about to take place for GRY. Might explain the dive in the SP.

Gryphon Sees 50% Banfora Resource Increase, May Raise A$300M
10/05/2012 5:08PM


By Rhiannon Hoyle

Of DOW JONES NEWSWIRES


SYDNEY (Dow Jones)--Gryphon Minerals Ltd. (GRY.AU) said Thursday that it expects to lift the inferred resource estimate on its Banfora gold project in Burkina Faso by 50% in the coming months.

The increase should boost its ability to obtain capital for the project, the company said, adding it may head back to financial markets to raise around 300 million Australian dollars (US$302 million) to construct its processing plant.

The West Africa-focused mining company, which currently has an independent inferred resource of 2 million ounces of gold at Banfora, expects to upgrade the estimate to 3 million ounces within the next six weeks, Managing Director Steve Parsons told reporters in Sydney.

Gryphon--which is targeting first output at the site in 2014--will then likely begin to seek funding for the construction of its planned 3.5 million-metric-ton per annum processing plant, estimated to cost around A$300 million, said Parsons. Funding may come from a range of sources, including the debt market, he added.

A listing on the Toronto Stock Exchange is also being considered for later in the year, he said.

"It opens up another avenue for raising funds," Parsons said, adding that around half the company's investor base--which includes J.P. Morgan Nominees Australia Ltd. and the International Finance Corporation--is outside of Australia.

Gryphon in November raised A$58.5 million through the issue of new shares at A$1.30 each. The company had originally looked to place 45 million shares at A$1.40 each, but lowered the price due to an initial lack of demand, a person familiar with the matter said at the time.

The company's shares closed Thursday at 75.5 cents, down 4.4% on the previous close, giving the company a market capitalization of A$275 million.



-By Rhiannon Hoyle, Dow Jones Newswires; 61-2-8272-4625; [email protected]