The sale, which accounted for about 5.4% of the company and was arranged by Morgan Stanley, came after zinc, copper and aluminum prices have resumed their uptrend over the past week. ZinifexÆs share price is trading about 15% below a high of A$13.54 which it hit on May 12, just as global stock markets turned south, but has more than doubled in the past 12 months.
The identity of the selling shareholder wasnÆt clear last night, but sources say the party had retained part of its stake in the company.
The shares were sold at a price of A$10.90, or a 4.9% discount to MondayÆs (June 5) close of A$11.46. The price was fixed towards the bottom of the A$10.85 to A$11.05 range at which the shares were offered to investors, but the discount was in line with the most recent placements by Australian-listed companies where shares have been sold at discounts between 4.8% and 5.2% versus the most recent close.
People familiar with the placement said about one quarter to one third of the shares went to domestic investors, while the rest was split fairly evenly between Asian and European investors. The order book was said to have been closed as soon as it was fully covered.
ôThis is a direct play on zinc and whatever outlook you have on the metal,ö one source says in response to why investors would have wanted to buy into the company. ôQuasi alternative asset classes have also been in favour lately.ö
The latest rebound in zinc prices have been underpinned by a decline in inventories and despite the drop from record highs about a month ago, the metal closed yesterday on the London Metals Exchange at $3,585 per tonne, or 88% above where it started the year.
Zinifex is one of the largest integrated zinc and lead producers in the world. The company's operations include the mining and processing of zinc and lead ores and the smelting of zinc and lead concentrates. It also produces significant amounts of silver and some copper and gold.
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