Sirius Minerals PLC (SXX) on 21st May announced that the open offer portion of its new funding package for Stage 2 Financing was oversubscribed and now the shareholder equity sale has closed in accordance with its terms. The announcement means that the group had received valid acceptances under the Open Offer in respect of 218,048,057 shares, which were priced at 15p each, to raise gross proceeds of approximately $425 million (£327 million). The number of outstanding shares will now enlarge to 6,977,537,829 Ordinary Shares in aggregate. The company will now make an application to the Financial Conduct Authority (FCA) for the new ordinary shares issued to be admitted to the market, and it is expected that admission of new shares will become effective on 23rd May 2019.
The funding relates to the launch of stage 2 financing, which entailed an underwritten Firm Placing and Placing and Open Offer to raise gross proceeds of approximately $400 million and an offering of guaranteed convertible bonds with an aggregate principal amount of nearly $644 million. The issue price of the open offer, which was announced on 30th April, represented a discount of between around 18 and 32 per cent to the closing price on 29th April. The group also plans to issue senior secured guaranteed bonds worth $500 million and a committed and secured revolving credit facility with a maximum commitment of $2.5 billion. The total financing plan is worth $3.8 billion (£2.9 billion), which will be used for the timely completion of its North Yorkshire polyhalite venture in the UK and will help the company in the extraction of mineral salt.
The Managing Director and Chief Executive Officer, Chris Fraser, said that the management was encouraged by the oversubscribed Open Offer and today's result would take the company another step closer to bringing POLY4 to the global agriculture industry. He also remarked that the results indicated a strong equity market support for markets-led solution for stage 2 funding and the company will now focus on delivering the next phase of the funding package. The group also published offering circular relating to the issue senior secured guaranteed bonds. The company revealed that bonds worth $506 million would be issued at 5 per cent due on 2027.
Sirius Minerals is a Scarborough, North Yorkshire-based fertiliser development company. The company is focused on the development and operation of its polyhalite project in North Yorkshire, which contains the most abundant, highest grade resource of polyhalite, a unique multi-nutrient fertiliser.
Share Price Commentary
Daily Chart as at May-22-19, after the market closed (Source: Thomson Reuters)
On 22nd May 2019, SXX shares closed at GBX 15.00, down by 1.96 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 39.61/GBX 14.95. The company’s stock beta was 1.93, reflecting more volatility as compared to the benchmark index. Total outstanding market capitalisation was around £754.88 million.
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