South Africa’s Sibanye Gold will tap shareholders for funds at a discount of 60 percent in a $1 billion rights issue, the mining company said on Thursday.
Sibanye will use the rights issue to repay a portion of a $2.65 billion loan facility it used to acquire U.S. platinum producer Stillwater.
The company will offer new shares at 11.28 rand each, a discount of 60 percent to its closing price on May 17, it said in a statement.
Shares in Sibanye fell more than 6 percent after the announcement, but narrowed losses to 2.3 percent at 27.83 rand by 1003 GMT, compared with a 0.5 percent gain in the Johannesburg Securities Exchange’s gold mining index.
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Sibanye, a portfolio of South African gold mines spun out of Gold Fields in 2013, has bought several platinum mines in its home market. Stillwater is its first foreign venture.