Petropavlovsk's IRC receives applications for 14.1% of supplementary issue; underwriters to purchase remainder
MOSCOW. Aug 5 (Interfax) - IRC, a subsidiary of UK-based gold miner Petropavlovsk, which is the sole iron ore producer in Russia's Far East, has collected applications for approximately 182.49 million supplementary shares, amounting to 14.1% of the issue's initially planned volume, the company said in a statement.
Based on the placement price - 0.315 Hong Kong dollars each - IRC will receive 57.5 million Hong Kong dollars (approximately $7.4 million) from the placement.
The issue underwriters will purchase the remaining shares, IRC said. As a result, proceeds from the placement will total 408 million Hong Kong dollars ($52.6 million).
The IRC stake held by Petropavlovsk, which is not participating in the placement, will be diluted to 35.83% from 45.39%. China's General Nice, IRC's second biggest shareholder, which applied to purchase 62.3 million supplementary shares worth $2.5 million, will see its stake shrink to 23.2% from 28.1%.
The underwriters - the Pine River and Sothic Capital funds and investment company JABCAP - will acquire stakes of 13.57%, 2.71% and 1.81% respectively.
IRC announced at the end of June that it would place about 1.296 billion shares (26.7% of initial charter capital), or 4 new shares for each 15 existing shares. IRC expects to receive 385 million Hong Kong dollars ($49.6 million) from the placement net of expenses.
The proceeds will be used to complete construction of the Kimkano-Sutarsky Mining and Beneficiation Plant in Russia's Jewish autonomous region ($39.5 million) and to replenish working capital ($9.9 million).