Turquoise Hill -27% as trading begins on rights issue

|By:, SA News Editor

Turquoise Hill (TRQ -26.7%) shares are sharply lower as the rights issued under the miner's recent $2.4B rights issue began trading on a when-issued basis today in Toronto.

More than 1B shares are expected to be issued under the rights offering, resulting in a doubling of TRQ's shares outstanding.

TRQ will use the proceeds to repay Rio Tinto (RIO +2%)for a $600M bridge loan and $1.8B in interim funding, and to use any remaining funds for the continued financing of the Oyu Tolgoi copper-gold project; TRQ has stumbled in its negotiations with the Mongolian government over financing for the mine.