Pegasus Gold Inc. Completes $100 Million Convertible Subordinated Notes Offering

Strategic Insights -

Pegasus Gold Inc., a leading international gold mining company, has successfully completed the issuance of its $100 million Convertible Subordinated Notes due April 30, 2002. This offering allows the company to access a significant amount of capital, which it plans to utilize for a potential takeover bid to acquire the remaining shares of Zapopan N.L. The notes carry an attractive interest rate of 6.25 percent and are convertible into common shares at a favorable conversion price of $14.92 per share.

Key Takeaways:

  • Pegasus Gold Inc. has completed the offering of its $100 million Convertible Subordinated Notes due April 30, 2002, with an annual interest rate of 6.25 percent.
  • The notes are convertible into common shares at a conversion price of $14.92 per share, which is higher than the closing sales price of $12.75 on April 4, 1995.
  • The company plans to utilize the proceeds to finance a potential takeover bid for the remaining shares of Zapopan N.L., which it does not already own.
  • Any net proceeds not applied towards the acquisition will be available for general corporate purposes, including debt repayment, capital expenditures, and potential acquisitions.
  • The notes are not registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption.
  • The company's common shares are traded on the American, Toronto, and Montreal stock exchanges under the symbol PGU.
  • Options on the company's common shares are traded on the Chicago Board Options Exchange and the Montreal Exchange.

Statistics:

  • $100 million: the total amount of the Convertible Subordinated Notes offering.
  • 6.25 percent: the annual interest rate of the notes, payable semiannually beginning October 31, 1995.
  • 42 percent: the percentage of shares of Zapopan N.L. not already owned by Pegasus Gold Inc.
  • $14.92: the conversion price of the notes into common shares.
  • $12.75: the closing sales price of Pegasus common shares on the American Stock Exchange on April 4, 1995.

Sources:

  • Business Wire, April 5, 1995: "Pegasus Gold Inc. Completes Convertible Subordinated Notes Offering."
  • Securities Offerings, Pegasus Gold Inc., Spokane.