$LMI.L – Lonmin – rights issue

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.


About mcturra2000

Computer programmer living in Scotland.
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