The interest of gold producer Rayrock Yellowknife Resources (TSE) in oil and gas producer Discovery West Corp. will be reduced to 39.6% (on an undiluted basis) from 47% following completion of an offering by the latter.
After Discovery announced the sale of 3.25 million special warrants to purchase common shares of Discovery at $3.45 per share, Rayrock said it would participate by selling an additional 750,000 warrants to purchase shares of Discovery out of its control block at the same price and on the same terms.
The special warrants will be issued subject to regulatory approval.
Meanwhile, Rayrock plans to raise $15 million through the sale of two million special warrants at $7.50 each. Each warrant will entitle the owner to receive one common share of Rayrock at no additional consideration. The warrant sale requires regulatory approval. Rayrock says the proceeds will be used in connection with its announced acquisition of an increased interest in the Marigold gold mine in Nevada.
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