19/03/2008 - 09:43

Iluka's $353m pro-rata entitlement offer gets strong support

19/03/2008 - 09:43

Bookmark

Save articles for future reference.

Iluka Resources Ltd confirmed today that it completed the institutional component of its 4 for 7 pro-rata accelerated renounceable entitlement offer as shareholders took up their full entitlement in the $353 million rights issue.

Iluka's $353m pro-rata entitlement offer gets strong support

Iluka Resources Ltd confirmed today that it completed the institutional component of its 4 for 7 pro-rata accelerated renounceable entitlement offer as shareholders took up their full entitlement in the $353 million rights issue.

The offer was announced on 12 March 2008 and instigated a trading halt which was removed this morning with the company's shares trading at $3.47 at 10am.

The principal purpose of it is to give the struggling minerals sands miner the financial capacity to proceed with the development of the Jacinth-Ambrosia mineral sands project in the Eucla Basin, South Australia.

 

Full announcement pasted below:

Iluka Resources Limited (Iluka) today advised that it has successfully completed the institutional component of its 4 for 7 pro-rata accelerated renounceable entitlement offer to shareholders (the Offer).
The principal purpose of the Offer is to give Iluka the financial capacity to proceed with the development of the Jacinth-Ambrosia mineral sands project in the Eucla Basin, South Australia. Development approval for the Jacinth-Ambrosia project is expected to be sought from the Iluka Board in May 2008, subject to satisfactory completion of the definitive feasibility study for the development.
Iluka announced the Offer on 12 March 2008 and instigated a trading halt over the four day trading period from 13 March 2008 to 18 March 2008 inclusive.
Completion of the Institutional Offer
At least 97 million New Shares will be issued under the institutional component of the Offer (Institutional Offer) and associated bookbuild, raising at least A$248 million at the offer price of A$2.55 per New Share.
The number of New Shares referable to the entitlements renounced by eligible institutional shareholders and New Shares referable to ineligible institutional shareholders was approximately 1.44 million only, indicating very strong support for the Offer from Iluka's existing institutional shareholders. These New Shares were sold in a bookbuild process (the Institutional Bookbuild) to a number of institutional investors.
The Institutional Bookbuild was conducted on 18 March 2008 and was about 3.5 times oversubscribed. The clearing price for the bookbuild shares was A$3.25 per New Share, A$0.70 above the A$2.55 offer price and only 1 cent below the theoretical ex-entitlement price of A$3.26 based on Iluka's closing share price on 12 March 2008.
Accordingly, institutional shareholders who did not take up their entitlements will receive A$0.70 for each New Share not taken up.
The New Shares from the Institutional Offer and the Institutional Bookbuild are expected to be issued on 28 March 2008 and are expected to commence trading on the ASX on the same day.
Retail Offer
The balance of up to 41 million New Shares (will be issued under the retail component of the Offer (the Retail Offer) and associated bookbuild, raising up to A$105 million.
The Retail Offer is being made pursuant to a replacement prospectus to be lodged today with the Australian Securities and Investments Commission (the Prospectus) and is open for eligible retail shareholders in Australia and New Zealand. A copy of the Prospectus will
be mailed to eligible retail shareholders on the Iluka share register as at the Record Date of 7.00pm (AEDT), Tuesday, 18 March 2008.
The terms of the Retail Offer are the same as under the Institutional Offer: eligible retail shareholders will be entitled to subscribe for 4 New Shares for each 7 Iluka shares held at the Record Date at the offer price of A$2.55 per New Share. The offer price represents a discount of 30 per cent to the closing price of Iluka's shares on Wednesday, 12 March 2008 and a 22 per cent discount to the theoretical ex-entitlement price on 12 March 2008.
Any eligible retail shareholder who wishes to acquire New Shares under the Retail Offer will need to complete the personalised entitlement and acceptance form that will accompany the Prospectus.
The Retail Offer opens today, Wednesday, 19 March 2008, and is expected to close at 5.00pm (AEST) on Wednesday, 9 April 2008.
Eligible retail shareholders may choose to take up their entitlement in whole, in part or not at all. A number of New Shares equivalent to those which would have been issued on the exercise of the entitlements not taken up and those which would have been issued to retail shareholders who are ineligible to participate in the Retail Offer, will be offered for subscription to selected institutional investors through a bookbuild process commencing on or around Tuesday, 15 April 2008 (the Retail Bookbuild).
Any positive difference between the Retail Bookbuild price and the offer price of the New Shares will be paid to the retail shareholders who did not take up their entitlement or who were ineligible to participate in the Retail Offer.
The Offer is fully underwritten by ABN AMRO Equity Capital Markets Australia Limited and Citigroup Global Markets Australia Pty Limited (the Joint Lead Managers).

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options