Golden Energy and Resources to pare stake in Stanmore through entitlement offer

GOLDEN Energy and Resources (Gear) AUE is reducing its stake in Stanmore Resources by subscribing for US$300 million of its entitlements in the Australia-listed coal producer's offer of new ordinary shares on the Australia Stock Exchange (ASX).

Through the offer, Stanmore plans to raise some US$506 million to partially fund its acquisition of BHP Group's 80 per cent interest in BHP Mitsui Coal.

The transaction's sole appointed lead arranger, lead manager and bookrunner Petra Capital has agreed to underwrite the remaining US$206 million.

Gear currently holds a 75.33 per cent interest in Stanmore through its subsidiary Golden Investments, which has agreed to have its renounced rights accelerated and sold through the institutional bookbuild.

The group is expected to retain an approximately 64.1 per cent interest in Stanmore upon completion of the offer.

Through the 7 for 3 pro-rata renounceable accelerated entitlement offer, Stanmore will issue about 631 million new fully paid ordinary shares - representing 223 per cent of its current shares on issue - at the offer price of A$1.10 per new share.

In its Mar 3 announcement on the ASX, Stanmore said its offer price represents a 12 per cent discount to Stanmore's last closing share price on Mar 2; an 8.4 per cent discount to its 5-day volume weighted average share price on the same date; and a 3.9 per cent discount to Stanmore's theoretical ex-rights price of A$1.145.

The transaction comprises an institutional entitlement offer spanning Mar 3-4, and a retail entitlement offer which will open on Mar 10 and be conducted at the same offer price and ratio as the institutional entitlement offer.

Trading of retail entitlements on the ASX is expected to commence on Mar 7 on a deferred settlement basis, and conclude on the close of trading on Mar 14.

Institutional entitlements which are not taken up will be sold under an institutional shortfall bookbuild along with the entitlements of ineligible institutional shareholders of Stanmore.

Shares of mainboard-listed Gear closed Wednesday S$0.05 or 15.6 per cent higher at S$0.37 on the Singapore Exchange, while Stanmore shares ended A$0.055 or 4.6 per cent higher at A$1.25 on the ASX.

READ MORE:

• Golden Energy and Resources to raise up to S$86.9 million through share placement
• Golden Energy swings into black for H2; full year Ebitda at record
• Golden Energy and Resources buys remaining stake in Stanmore owner for US$30m