Alumina sells 13% stake to China’s Citic for A$452m
PERTH (miningweekly.com) - China’s Citic Group has made a A$452-million investment in aluminium major Alumina, taking a 13.04% stake in the company.
Alumina on Thursday announced that Citic would unconditionally subscribe for more than 366-million shares, at A$1.23 a share, to raise the funds. The shares represent some 15% of Alumina’s current capital base.
The placement represented a premium of 3% to the closing price of Alumina shares on February 13, and an 11% premium to the one-month volume-weighted average price of the company’s shares.
Alumina CEO John Bevan told shareholders that the placement introduced Citic as a strategically aligned and financially strong long-term investor, adding that the funds raised under the placement would be applied to repay bank debt.
“This secures a strategic long-term investor at a premium to our recent share price. Citic’s investment demonstrates its confidence in the alumina industry and its understanding of Alumina’s unique position in the global market,” he said.
The investment had already been approved by the Australian Treasury and by the National Development and Reform Commission of China, as well as other relevant Chinese authorities.
Following the transaction, Alumina’s net debt position would fall from around $681-million to $216-million.
Alumina’s shareholders responded favourably to the news, with share prices rising more than 10% on Thursday, to trade at a high of A$1.40 a share.
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