Magma Energy Corp.
TSX : MXY

Magma Energy Corp.

July 12, 2010 16:29 ET

Magma Energy Corp. Announces Prospectus Offering

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 12, 2010) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Magma Energy Corp. ("Magma" or the "Company") (TSX:MXY) is pleased to announce that it has filed a preliminary short-form prospectus in connection with a proposed marketed offering ("Offering") of approximately $40 million of common shares ("Shares") at a price of $1.12 per share. In addition, Magma has also granted the underwriters an option, exercisable in whole or in part, up to 30 days following the closing of the Offering to increase the Offering by up to an additional 15% of the number of Shares sold pursuant to the Offering to cover over-allotments and for market stabilization purposes. The Offering will be managed by a syndicate of underwriters led by Raymond James Ltd.

The net proceeds from the Offering are intended to be used for Magma's acquisition of 52.35% of the outstanding shares of HS Orka hf from Geysir Green Energy, as well as for working capital and general corporate purposes. Closing of the Offering is expected to occur on or about July 27, 2010.

The Offering is being made in all provinces of Canada, excluding Quebec, and is subject to the approval of applicable securities regulatory authorities. The Shares offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Contact Information

  • Magma Energy Corp.
    Alison Thompson
    Vice President, Corporate Relations
    604.646.1882