Shareholders of troubled nickel and zinc mining company Talvivaara (OMXH: TLV1V, LON: TALV) have given the company Board of Directors the authorization to undertake a share offering of up to 26 000 000 000 new shares. The share issue would be with pre-emptive subscription rights to existing shareholders and would nearly wipe out existing stock, forcing people to at least do something with the rights. There is also the option to print more shares to pay back convertible bond, which is conditional upon the completion of above mentioned share issue. Environmental activists have been demonstrating outside the EGM site and an apparent act of terror was committed in the building, resulting in minor damages.
Shortly after initial reports, the company published Terms and Conditions of the offering. Gross proceeds of 261 million are sought in an offering where six new shares will be issued per one existing share. Subscription price will be 0.16 EUR per new share. This is a 84.5% discount on Existing Share closing price and a 43.7% discount to the theoretical ex-rights price of an existing share based on a closing price of 1.031 EUR on March 7th 2013.
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