Platinum miner LMI (Lonmin) released two RNS’s today:
- The finals (http://is.gd/ys6crl) showed a loss for the year of $2262m (2014: $326m loss), with net debt of $185m (2014: $29m)
- Proposed rights issue (http://is.gd/j1xjHS) of $407m gross, but there are hefty fees of about $38m to be deducted.
There are currently 587m shares in issue. At a share price of 16.20p, it has a market capitalisation of £95.1m. It will issue 26,998m shares in a 46 for 1 rights issue at a price of 1p per new share. Following that, there will be a consolidation in a ratio of 100:1.
LMI was up 10% in early trading, but is now currently down 13%.
Barclays has said: “We do not believe that Lonmin in either its existing or proposed form is a going concern on a 3-year view. Even in our ‘best case scenario’, we envisage Lonmin will generate negative cashflows of at least $231m … over the next three years if prices remain at spot levels”
Update 10-Nov-2015: A Stockopedia member discusses the rights issue, and says that there is no value in Lonmin right now.