Petra Diamonds shareholders back rights issue
LONDON – Shareholders in mining company Petra Diamonds on Wednesday approved a rights issue to raise about $170-million to help cut its debt burden, driving the share price around 5% higher.
The company, which has suffered setbacks in Tanzania as well as production delays and strikes, had said there was a risk it could run low on working capital and breach its debt covenants if shareholders did not back the rights issue.
The shareholders backed it by more than 99% at a special general meeting on Wednesday.
CEO Johan Dippenaar said the focus was on reducing gearing, lowering interest payments and on consolidating progress.
He said in a telephone interview the results of the last three quarters were "very solid", but the company still needs to resolve a dispute with the Tanzanian government.
Petra Diamonds' shares lost around half of their value last year after the company suffered delays in expansion projects and in September the Tanzanian government seized a consignment of diamonds.
So far this year, the share price had lost another 1.5%, but by 1450 GMT it was 4.7% higher versus the previous day's close.
While the seized diamond consignment is still in dispute, five shipments have been exported since and talks are ongoing, the chief executive said.
"We are full of hope we will achieve an amicable settlement," Dippenaar said.
Petra, which was accused of under-declaring the value of the stones, is caught up in a wider crackdown on international miners by the Tanzanian government as it seeks a greater share of mineral revenue. Petra has denied the accusation.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation