Jindal tightens Wollongong grip

JINDAL Steel could be closer to acquiring Wollongong Coal with the miner raising $49.6 million from the institutional component of its 19:20 renounceable accelerated rights issue.
Jindal tightens Wollongong grip Jindal tightens Wollongong grip Jindal tightens Wollongong grip Jindal tightens Wollongong grip Jindal tightens Wollongong grip

Courtesy of Wollongong Coal, formerly Gujarat NRE Coking Coal.

Blair Price

The Illawarra coal producer will consequently issue about 2.756 billion shares to the institutional shareholders who participated.

The deal, offering 19 new shares at 1.8c each for every 20 held, is expected to be opened up to retail investors from November 17-20.

Wollongong flagged that its major shareholder Jindal could increase its stake by 74.39% to 84.99% when it first announced the capital raising plans last week.

If achieved, Jindal will only be 5.01% short of reaching the 90% level to trigger a compulsory acquisition of Wollongong.

The coal producer forecasted the institutional and retail segments of its rights offer to raise about $66.68 million before costs.

Wollongong plans to use $45 million of the raised funds to repay a loan facility offered by Jindal.

The company said the remaining funds raised could go into paying salaries, including redundancies, capital development, plus repaying other past liabilities.

ICN is seeking clarification from Wollongong on Jindal’s new stake of the coal producer.

Wollongong’s shares unchanged at 1.6c yesterday.

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