Centennial to raise $A100 million

CENTENNIAL Coal plans to sell 20 million new shares, or 7.5% of issued capital, to institutional investors to raise about $A100 million.

Staff Reporter

The money would be used to pursue expansion opportunities and implement further efficiency and cost-reduction initiatives, Centennial said. Macquarie Equity Markets will conduct the bookbuild.

"The positive outlook for both thermal and coking coal markets, their strong growth and the rapid changes in Asia, should create further opportunities for Centennial consistent with our long-term growth strategy," said chief executive Bob Cameron.

Increased production from the newly opened Mandalong operations is planned. The company also hopes with recent changes to NSW Government planning legislation it can accelerate development of its open-cut mine at Anvil Hill.

The company also announced a substantial increase in the reserve base at the Tahmoor coking coal mine in New South Wales, from 47.5 million tonnes to 80.3Mt.

“The 70% increase in the reserve base has provided greater certainty for the long-term mining operations at the Tahmoor mine,” Cameron said.

“This justifies our confidence in the acquisition of Austral Coal, which also provides Centennial with a substantially enlarged presence in the coking coal market.”

Centennial also intends approaching the US private placement debt market in the short term.

Centennial shares have been placed in a trading halt until the placement is completed.

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