Companies: OXS   

Aim-listed gold prospector Oxus Mining has launched a £5 million placing and open offer at 10p a share to construct the first phase of its Amantaytau gold prospect in Uzbekistan, writes Robert Tyerman.

Existing Oxus (OXS) holders, who have seen the shares fall from a 33.5p peak, are being offered 52 per cent of the placing, which is fully underwritten. Brown Shipley Securities is handling the placing, which is necessary to enable Oxus to raise another £11 million, including a subordinated insured debt facility.

All this is needed as a condition of a £22 million project finance facility agreed with banking group Societe Generale last month. When Oxus raised £8 million at 30p some time ago, the market's rejoicing was short-lived, as it soon became clear the company needed much more, and the shares fell to 6p.

When this funding is complete, Oxus and its advisers believe it will have rthe funds to construct a one-million-ounce heap leaching project at Amantaytau. The company expects to be in production by mid-2003.