Lepanto eyes P1B from stock rights offer

Lepanto Consolidated Mining Co., the country’s oldest and biggest gold miner, is hoping to raise P1.04 billion from a stock rights offer to pay off debt and settle other accounts.

In a disclosure to the Philippine Stock Exchange, Lepanto said its board has approved a plan to offer shareholders one common share for every seven shares held on a record date yet to be fixed by the company.

The shares, which will come from the firm’s current unissued authorized capital, are priced at 25 centavos each.

Proceeds from the offer will be used to “retire loans and settle other accounts with banks, suppliers and service providers and advances from shareholders and related accounts,” Lepanto said.

Lepanto expected to turn around its financial performance last year with a projected net income of P200 million, compared with a net loss of P35.8 million in 2006.

Last year, the company sold to Zijin Mining Group Co. Ltd., China’s second largest gold miner, its 20-percent stake in Far Southeast Gold Resources Inc. for $70 million.

Lepanto owns 60 percent of Far Southeast Gold, a gold copper porphyry deposit located in Mankayan, Benguet.

Citing a 1997 feasibility study on the project, Lepanto said the Far Southeast lode has an estimated ore reserve of 123 million tons with 0.8 percent copper and 1.51 grams of gold per ton.