rc research overview, page-2

RBC Capital Markets comments on the Capital Raising


RBC Comment :

Extract Tops Up the Till; Increasing Target to $12

• On August 25, 2009, Extract Resources announced it is raising $91 million by
way of a two-part equity issue comprising a non-renounceable pro-rata offer to
certain eligible shareholders and a private placement to accredited institutional investors.
• The proceeds from the two issues will be used to accelerate exploration activities at the Rössing South project and to complete the Definitive Feasibility Study.
• We expect this issue to improve trading liquidity on the TSX.
• The three major shareholders of Extract (Kalahari Minerals, Rio Tinto and Polo Resources) have agreed to take their pro rata share of the Entitlement offer.
• After this equity issue is closed, we believe Extract will have sufficient funds to carry out its exploration activities as well as its definitive feasibility study.
• We are increasing our target for Extract to $12.00 per share, up from $11.50, previously.