04/02/2009 - 22:00

Brockman MD exercises options

04/02/2009 - 22:00

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BROCKMAN Resources managing director Wayne Richards has taken advantage of the recent upswing in the company's share price, exercising 1 million options in the money.

BROCKMAN Resources managing director Wayne Richards has taken advantage of the recent upswing in the company's share price, exercising 1 million options in the money.

Mr Richards, through his spouse, exercised $500,000 worth of options in late January at a price of 50 cents each, well before the July 1 2012 expiry date.

On the day of trade, the company's share price closed at 88.5 cents and at time WA Business News went to press, Brockman shares were trading at $1.

Brockman's share price had been hovering between 50 cents and 60 cents from October last year to the latter part of December, after suffering a steady decline from an all-time high of $3 reached in May 2008.

However, its share price has been on an upward trend since December 29, climbing from 56 cents to a high of $1.06 in mid-January 2009 and overshadowing the benchmark S&P/ASX 200 index.

Brockman Resources is not alone in this upward trend, with Pilbara iron ore miner Atlas Iron and explorer BC Iron recording the same trajectory during late December and January.

Shares in Atlas started their climb from 77.5 cents to a high of $1.50, while BC Iron rose from 19 cents to a high of 38 cents.

Hartleys resource analyst Andrew Muir said the turnaround in the iron ore players' share prices was a result of improving sentiment towards the bulk commodity.

"I think it's probably got a little bit to do with sentiment, it seems to be changing towards iron ore because the market's seen the spot price start to increase," Mr Muir told WA Business News.

According to commodity watcher Metal Bulletin, the spot price of iron ore has risen nearly 20 per cent during the past two months, rising from $US62.27 per tonne in late November to $US74.25/t in late January.

With the spot price on the rise, Fat Prophets analyst Gavin Wendt said Chinese iron ore consumers would want to settle benchmark iron ore price negotiations quickly to capitalise on the current doom and gloom.

"The longer [negotiations] go on, there's the prospect that economic conditions can improve somewhat, so [iron ore] producers would want to delay settlement as long as possible," Mr Wendt said.

Most analysts are tipping the benchmark iron ore price to fall between 20 and 30 per cent.

Late last year, Brockman announced that it would focus its efforts on the much larger stage two of the Marillana iron ore project, located in the Pilbara, in light of the economic volatility.

The project will start with a production rate of 15 million tonnes and its mine life will cover 40 years, compared to the stage one 2mtpa operation with a lifespan of three years.

COOTE INDUSTRIAL

MANAGING director Michael Coote has sold more than $4 million of Coote Industrial shares to a family trust.

In a notice to the Australian Securities Exchange, Mr Coote revealed that the Ganesha Family Trust had bought 32 million shares at a cost of $4.16 million through an off-market purchase.

The trust now holds 34.64 million shares.

It is not known what interest Mr Coote holds in the trust, with a call for comment not returned at time of publishing. Mr Coote bought a further 80,000 shares on market at a total cost of $12,000, or 15 cents each.

At the end of the transaction, Mr Coote held 42.59 million shares in the company through direct and indirect interests, representing just under a third of the company's total issued capital.

Coote has 116.48 million shares on issue and a market capitalisation of $19.8 million.

Earlier in the week, shareholder Gragher Capital ceased to be a major stakeholder in Coote after selling 2.31 million shares for $485,802.82 through an on-market transaction.

FMG

SEVERAL directors of Fortescue Metals Group have been steadily increasing their shareholding in the iron ore miner under the non-executive director share plan.

Chairman Herb Elliot and directors Kenneth Ambrecht and Geoffrey Brayshaw spent a combined $17,119 to purchase 8,961 shares in FMG.

Mr Elliot is gradually increasing his interest after he suddenly sold 400,000 shares late last year, providing no explanation to shareholders.

The sudden sale left Mr Elliot with a holding of 2.14 million shares, however following this week's purchase, the former marathon runner now holds 2.16 million shares.

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