LSE-listed titanium minerals and zircon producer Kenmare Resources has launched a proposed tender offer to buy back up to 13.5% of its issued ordinary shares in an effort to increase shareholder returns.
This follows the successful completion of its major capital projects and is supported by the strong operational performance of the company and its subsidiaries and commodity market strength this year.
In its financial results for the six-month period ended June 30, Kenmare reported a profit after tax of $48-million, up from the $12.7-million of the year prior.
Kenmare, which operates the Moma titanium minerals mine, in northern Mozambique, proposes to return up to £61.8-million to eligible shareholders through the tender offer at £4.17 an ordinary share.
The tender offer is to be funded from Kenmare’s existing and available cash resources and borrowings under the group’s facilities. The offer will close at 13:00 on December 9.
Eligible shareholders will be able to decide whether to tender none, some or all of their ordinary shares within the overall limits of the tender offer.
The tender offer will provide eligible shareholders with an opportunity to sell part or all of their ordinary shares and to receive their respective share of the cash which Kenmare is seeking to return.
Directors who are beneficially interested in ordinary shares have indicated that they will not tender ordinary shares following the tender offer.
Also, the tender offer will provide eligible shareholders holding 500 ordinary shares or fewer in certificated form an opportunity to sell their entire shareholding in Kenmare without the dealing costs or commissions that might otherwise make such a sale uneconomic.