Gold Resource raises $5 million in strategic tie-up; Immunodiagnostic, Suroco sell stock; Largo plans deal

By Kenneth Lim

Boston, Dec. 10 - Gold Resource Corp. raised $5 million from a sale of stock to a new strategic investor and said additional fundraising could be in the works.

Immunodiagnostic Systems Holdings plc sold £3.12 million of its common stock through a private placement to raise working capital.

Largo Resources Ltd. announced plans for a C$3 million stock placement, while Suroco Energy Inc. wrapped up the initial tranche of its C$3 million offering.

Gold Resource settles Hochschild deal

Gold Resource placed $5 million of its common stock with Hochschild Mining plc.

The company sold 1.7 million restricted common shares at $3 apiece. Gold Resource common stock (OTCBB: GORO) rose 26.09% or $0.66 to close at $3.19. The company has a market capitalization of $109.79 million.

Proceeds will be used for the continued construction and exploration of the company's El Aguila project in Oaxaca, Mexico.

Denver-based Gold Resource is a gold and silver exploration and development company.

Hochschild and Gold Resource are also evaluating whether to accelerate development of the La Arista underground vein in the El Aguila project. Hochschild may buy an additional 4.3 million shares at $3 per share for a total of $12.9 million within the next 80 days.

If Hochschild completes the additional funding, it may appoint one director to the board of Gold Resource.

"We see our strategic alliance with Hochschild as an important milestone in the creation of value for our shareholders," Gold Resource president William W. Reid said in a statement. "This alliance promotes a common goal to achieve significant production at the Aguila Project at the earliest possible date. We believe Hochschild's strategic investment in GRC underscores the significant potential of our El Aguila Project."

The financing was designed to minimize dilution for shareholders, Reid stated.

"Our goal is and always will be to keep effective dilution to a minimum," he said. "This important strategic alliance with Hochschild results in approximately 5% dilution from the 1.67 million share purchase or a possible 15% total dilution if the additional 4.3 million shares are purchased.

"However, our recent 67% increase in our production targets of up to 200,000 gold equivalent ounces of precious metals per year more than offsets this dilution relative to per share value. With the additional funds we would accelerate development of our high-grade La Arista deposit.

"Our excellent team in Oaxaca continues to move the Aguila Project forward on all fronts as we focus, at the earliest possible date, on emerging in the elite class of low cost gold producers," he added.

"We believe the driving force behind Gold Resource Corp. on a going forward basis will be achieving cash flow with the potential to pay a meaningful dividend. We welcome Hochschild as a shareholder and believe their interest and investment in Gold Resource Corporation creates an alliance that strengthens our company and its mission."

Hochschild executive chairman Eduardo Hochschild said: "We are delighted to announce this transaction which provides Hochschild access to high grade, profitable ounces with a near term production profile. We have operated in Mexico for over two years and are keen to strengthen our position in this mineral rich region of the Americas. Gold Resource Corporation has a highly experienced management team and we look forward to working with them to develop the significant potential of the El Aguila property as well as the other properties in their impressive project pipeline."

Immunodiagnostic raises £3.12 million

Immunodiagnostic Systems placed £3.12 million of its common stock through a private placement.

The placement comprised about 2.4 million ordinary shares at 130p per share. Immunodiagnostic, a £35.31 million market capitalization company, saw its common shares (LSE: IDH) lose 24.62% or 48p to close at 147p on Wednesday.

Proceeds will be used to provide additional working capital.

Boldon, United Kingdom-based Immunodiagnostic Systems manufactures and distributes medical diagnostic products that include the IDS-iSYS push-button, walk-away system.

Investors in the placement included Immunodiagnostic chairman David Evans and chief operating officer Ian Cookson, who took 37,692 shares between them.

"We are very pleased to have raised these funds, particularly during such challenging times, and this reinforces the strength of the IDS story," Immunodiagnostic chief executive Roger Duggan said in a press release. "The additional funding will facilitate the fast roll-out of the IDS iSYS and will allow us to build long-term revenues on a reagent rental model."

Largo plans C$3 million deal

Largo Resources plans to offer C$3 million of its common stock through a non-brokered private placement.

The shares will be sold at C$0.06 apiece.

Largo common stock (TSX: LGO) slipped 7.14% or C$0.005 to close at C$0.065 on Wednesday. The company's market capitalization is C$9.27 million.

Proceeds will be used for working capital.

Largo is a Toronto-based resource development and exploration company.

Suroco raises C$2.03 million

Suroco Energy raised C$2.03 million in the initial tranche of a C$3 million private stock placement that priced Nov. 7.

The company sold about 9.23 million common shares at C$0.22 apiece in the initial tranche. The entire deal is expected to comprise about 13.64 million shares.

Suroco common stock (TSX: SRN) closed at C$0.19 on Wednesday, lower by 34.48% or C$0.10.

Proceeds will be used to fund a near term oil field development drilling program in one of the company's assets in the Putumayo Basin of Colombia.

Based in Calgary, Alta., Suroco is an oil and natural gas exploration company.

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