| Lihir chases cash for PNG growth |
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| Friday,March 06,2009 Posted: 12:58 BJT(0458 GMT) 驻巴布亚新几内亚使馆经商处 |
LIHIR Gold wants to raise about $515 million from institutional investors to fund what it sees as an opportunity to fast-track its expansion while other companies cut their demand for mining industry equipment.
The capital raising comes just over a month after Lihir reported that 2008 underlying profits surged 54 per cent on record output and strong gold prices and said its financial position was "very secure" with a "strong foundation" for future growth investment.
In a statement yesterday, Lihir chief executive Arthur Hood said the raising would ensure the company had the financial resources available to deliver strong results.
He said current market conditions provided Lihir with an "exciting opportunity" to advance its Lihir Island upgrade in PNG as it targets annual output there of one million ounces.
Port Moresby-based Lihir said the raising, launched yesterday, would accelerate its process plant expansion at Lihir Island.
The placement is via a bookbuilding process that will set the price and the new shares will trade from March 12.
Lihir shares hit a three-year low last October of $1.53 but have since bounced back to $3.31 before trading was halted pending the capital raising.
After the institutional placement, all shareholders will be offered the chance to subscribe for up to $5000 of Lihir shares without incurring fees or costs.
"The recent downturn in global commodity markets has significantly reduced demand for mining industry equipment, process plant components and steel fabrication, which has led to more competitive pricing and created the opportunity for some stages of the Lihir Island expansion to be brought forward," the miner said.
Completing those stages could lead to marginal increases in 2010 and 2011 output, it said.
The fundraising would leave the company well placed to proceed with expansion opportunities developing in West Africa, where it has undertaken an extensive exploration campaign.
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