Israeli diamond tycoon Dan Gertler will acquire a 25 per cent stake in Toronto Stock Exchange-listed copper and silver producer Anvil Mining for nearly 20 per cent less than originally planned, thanks to deterioration in market conditions, the WA-based firm has announced.
Mr Gertler’s Catala Global had signed a deal in July to acquire 23.7 million Anvil shares at $C12.50 each – committing to spend $C296.3 million, worth about $305 million at the time.
Instead, Anvil announced today that “due to the significant deterioration in market conditions for resource companies since the original announcement of the placement”, it would reduce the issue price to $C10 per share – making the stake worth $C237 million ($261.5 million).
Proceeds from the placement, which represents a premium of 39 per cent to the company’s Friday closing price of $C7.21 on the TSX, will be used for work on the firm’s projects in the Democratic Republic of Congo.
The placement remains subject to regulatory and shareholder approval, with a meeting expected to be held next month.
The money will fund Anvil’s expansion of its Kinsevere copper mine and Kulu copper tailings operations in the Katanga province of the DRC, as well as providing working capital.
Anvil shares closed at $7.60, down 40¢ or five per cent.
ANDREW HOBBS
Source: http://www.thewest.com.au/
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