Canadian producer Teranga Gold Corp. has acquired a 5% stake inAustralia's Gryphon MineralsLtd. for about A$4.4 million.

Teranga said July 19 that it subscribed for 21,200,000Gryphon Minerals shares at 20.6 Australian cents apiece in a recent placement.

The Ontario-based miner is planning to Gryphon Minerals in anall-share deal worth about US$63 million and the issue price of the placementis equivalent to Teranga's offer for 1 Gryphon Minerals share under theproposed acquisition.

However, Teranga noted that the placement is not subject toshareholder approval or contingent on the completion of the acquisition.

Teranga's top priority is to fast track the development ofGryphon Minerals' Banfora gold project in Burkina Faso.

"In order to maximize our return and mitigate projectrisk, construction at Banfora needs to commence following next year's rainyseason," President and CEO Richard Young said.

The capital from the placement will be used to immediatelystart the resource conversion drilling and plant optimization studies requiredto complete a feasibility study by the first half of 2017.

It will also be used to update the tailings storage facilitydesign and relocation action plan required for a carbon-in-leach plant.

Teranga aims to pour first gold in the first half of 2019.