Freehills is acting for UBS AG, Australia Branch and Morgan Stanley Australia Securities Limited in relation to Ivanhoe Australia’s capital raising to fund its Osborne acquisition, develop the Merlin Project, partially repay debt and for ongoing exploration and development purposes.
The capital raising has been structured as:
- a 1-for-4 accelerated non-renounceable entitlement offer to raise up to approximately $231 million, which has been underwritten, and
- an institutional placement of $38 million,
at $2.88 per new share.
Under the terms of the offer, one free option will also attach to every two shares issued. Each free option is exercisable at a strike price of $3.38 at any time before 20 September 2011. Through the exercise of options, Ivanhoe Australia may raise up to $158 million in the future. The total proceeds of the entitlement offer, placement and exercise of options may therefore be up to $427 million.
Freehills partner Philippa Stone said, ‘We are delighted to have acted for UBS and Morgan Stanley on what is a significant capital raising for Ivanhoe Australia. The free option provides investors with the benefit of any upside and also gives the company a potential source of future funding.’
The Freehills team is led by Philippa Stone and Tony Sparks and is supported by lawyers Ivan Yu and Carl Hornigold.
Freehills also acted for the underwriter in Ivanhoe Australia’s initial public offering in 2008.
Freehills’ award-winning equity capital markets team has advised issuers or underwriters on many of Australia’s largest recent capital raisings, including acting for Aston Resources, Miclyn Express Offshore, Myer and Kathmandu on their recent IPOs, for Boral, TSI Fund, Woodside, Santos, Elders, Prime Infrastructure, Lend Lease and FKP Property Group. The team has also advised on many of the recent secondary raisings, and for the underwriters on numerous capital raisings including those by Rio Tinto, CSR, Challenger Diversified Property Group, Australand Property Group and DEXUS Property Group.
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