Ivanhoe Australia (ASX:IVA) is planning to raise up to $269 million for the acquisition of a project to be developed in Queensland and to repay current debt.
Ivanhoe plans to do so by announcing a capital raising which should fetch $123 million and a further $38 million through an institutional placement. Planning for the development of four separate projects is underway on projects containing molybdenum, rhenium, copper, gold, zinc, silver and uranium.
The company has been place into a pre-market trading halt. Ivanhoe Australia is owned 80% by the Canadian company Ivanhoe Mines which is chaired by Robert Friedland. The institutional and retail offers will be conducted via a one for four non-renounceable entitlement offer at $2.88. This is lower by 10.28 % compared to Ivanhoe's last traded price of $3.21.
Ivanhoe Mines has said that it will not take up its entitlements and will have its holdings reduced to 65% in Ivanhoe Australia. UBS and Morgan Stanley are underwriters, joint lead managers and bookrunners for the raising. The announcement about the institutional component of the offer will be made before Thursday.