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.
EXT Price at posting:
$9.54 Sentiment: LT Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)