ERA delays capital raise as shareholders claim 'unacceptable circumstances'
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More news: Energy Resources of Australia (ERA) has deferred the timetable for its proposed $860 million capital raising after two of its shareholders told the uranium producer that they are seeking a declaration of unacceptable circumstances with the Australian Government Takeovers Panel over the move.
ERA said that its independent board committee (IBC) received a letter from the miner's second largest shareholder Packer & Co and minority shareholder Zentree Investments, indicating that a Takeovers Panel application is being prepared, seeking a declaration of unacceptable circumstances in respect to the entitlement offer, and requesting interim and final orders.
The shareholders have requested that ERA amends the timetable for the entitlement offer so as to delay the "ex date" and commencement of trading of entitlements under the offer, until the Takeovers Panel makes a decision on the requested interim orders.
ERA said that its IBC does not agree that unacceptable circumstances exists in relation to the entitlement offer. However, it noted that "in the interests of minimising disruption" to the offer, the IBC has requested ASX to defer the entitlement timetable by five trading days, so that the ex date for the entitlement offer will now take place on 9 September.
ASX has agreed to implement the proposal but requires one business day's notice to do so. ERA's shares are consequently being placed in voluntary suspension while the proposal is processed.
The company's majority shareholder Rio Tinto has committed $760 million to the raise, which could see its stake increase from 86.33% to 99.2%.
In June, the Takeovers Panel declined to conduct proceedings on an application by Singaporean family office Zentree, which outlined concerns regarding a future equity raise that could increase Rio's voting power beyond the compulsory acquisition threshold of 90%.
ERA suspends shares ahead of capital raise announcement
The news: Uranium producer Energy Resources of Australia (ERA) has voluntarily suspended its shares from trading on the ASX, pending the release of an announcement regarding its capital raise unveiled last week.
The numbers: ERA shares dived 54.8% on Wednesday after the Darwin-based miner outlined plans for a heavily discounted entitlement offer to raise around $880 million at an offer price of $0.002 per share.
ERA shares were last trading at $0.005 per share.
The company's majority shareholder Rio Tinto has committed $760 million to the raise, which could see its stake increase from 86.33% to 99.2%.
The context: ERA requested that the voluntary suspension remain in place until the company releases the announcement, expected to arrive before the market opens on Tuesday.
The sources: ASX announcement, ASX announcement
