Hochschild Mining raises stake in Lake Shore Gold to 40 percent
Hochschild Mining Plc. increased its stake in Canadian gold producer Lake Shore Gold Corp. to 40 percent after buying 11.8 million shares from a subsidiary of FNX Mining Co. Inc.
The shares were acquired for C$1.82 per share or a total of C$21.4 million in cash.
In February, the FTSE-250 precious metals producer, which had focused on Latin American projects, said it has the right to increase its stake in Lake Shore to 40 pct by the end of this year.
Under the terms of the agreement, Hochschild will have the right to increase its existing board representation. Hochschild has spent a total of C$165.6 million to buy the 40 percent interest but is restricted from raising its state further before Nov 22, 2010.
It said it will draw down a $200 million syndicated loan facility, originally negotiated in February, as a result of its recent investments in Lake Shore Gold and the acquisition of the San Felipe project.