Linear gold shares drop over 10% on equity sale

The Canadian miner announced an equity offering at a discount of 10%

(Reuters) - 

Canadian miner Linear Gold Corp (LRR.TO: Quote) said its 9.05 million units equity offering was priced at C$2.10 each, a discount of 10% to the stock's Wednesday close.

Linear shares were trading down 16% or 37 Canadian cents at C$1.97 on the Toronto Stock Exchange.

The company said a syndicate of underwriters led by Cormark Securities Inc would also buy 520,000 flow-through common shares at C$2.40 a share, in addition to the 9.05 million units. Linear expects gross proceeds of C$20.3 million ($19.11 million).

The company said it would use the proceeds for the exploration, development and construction of its goldfields development project and for general working capital purposes.

($1=1.062 Canadian Dollar) (Reporting by Krishna Chaithanya in Bangalore; Editing by Pradeep Kurup)

© Thomson Reuters 2009 All rights reserved

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