* To sell 40 mln shares at C$2.05/shr
* Financing to raise gross proceeds of C$82 mln
* Shares fall 29 Canadian cents in early trade
(Recasts, adds details on financing. In U.S. dollars unless
By Euan Rocha
TORONTO, May 26 Denison Mines (DML.TO) said on
Tuesday it plans to sell shares, priced at a discount, to a
group of underwriters to raise capital for debt reduction
The Canadian uranium producer is selling 40 million of its
common shares at C$2.05 a share -- a 14.2 percent discount to
Monday's close of C$2.39 on the Toronto Stock Exchange.
The deal, which is being structured as a "bought deal",
will raise gross proceeds of C$82 million ($73 million). In a
bought deal an underwriter or syndicate buys shares from an
issuer before selling them on to the public.
The deal is being co-led by GMP Securities and Cormark
Securities. It also includes support from Canaccord Capital
Corp, Scotia Capital, CIBC World Markets and Raymond James
The proceeds from the offering will be used primarily to
lower the company's debtload, and any remaining cash may later
be used for project development needs, Chief Financial Officer
James Anderson, told Reuters.
The company has about $100 million in outstanding long-term
debt, at this time.
Denison is the latest among a series of Canadian mining
companies that have taken the discount-equity offering approach
to bolstering their balance sheets.
Last month, Lundin Mining (LUN.TO) and Moto Goldmines
MGL.TO also announced bought deal financings. Quadra Mining
QUA.TO and Capstone Mining (CS.TO) have also raised capital
through similar deals recently.
Denison has granted the underwriters an option to buy up to
an additional 6 million common shares at the offering price,
within 30 days after the closing of the offering.
If the option is exercised, the gross proceeds from the
financing will be about C$94.3 million. The offering is
scheduled to close on, or about, June 22 and is subject to
certain conditions, Denison said in a statement.
Shares of Denison fell 29 Canadian cents to C$2.10 in early
trade on Tuesday on the Toronto Stock Exchange.
(Reporting by Euan Rocha, editing by Peter Galloway)