MMC Announces Allotment, Greenshoe forceable by Nov. 4, Debut Tomorrow
The Offer Price has been determined at HK$7.02 per Hong Kong Offer Share (exclusive of 1% brokerage, 0.003% SFC transaction levy and 0.005% Hong Kong Stock Exchange trading fee).
Based on an Offer Price of HK$7.02 per Share, we estimate that we will receive net proceeds from the Global Offering of approximately HK4,017.9 million (Mogi: approximately 95.85% of total proceeds)from the 597,122,500 Offer Shares to be offered by the Company, after deducting underwriting fees and expenses payable by us and assuming the Over-allotment Option is not exercised.
We intend to use these net proceeds for the following purposes:
• approximately 50% (HK$2,008.9 million) for financing the Company’s mine and transportation infrastructure development projects, which currently include approximately US$125 million (HK$970.5 million) to finance a portion of the Company’s railway project and approximately US$80 million (HK$621.1 million) for the Company’s coal handling and washing plant. See the section headed “Business – Mining Operations – General” in the Prospectus;
• approximately 40% (HK$1,607.2 million) for acquisitions of companies with existing exploration rights and additional mining assets. As of the Latest Practicable Date, the Company had not identified any acquisition targets; and
• the remaining net proceeds of approximately 10% (HK$401.8 million) to fund working capital and other general corporate purposes. To the extent that proceeds are not used immediately for the purposes stated, they will be invested in short term demand deposits and money market instruments.
The Selling Shareholders will be selling a portion of their Shares in the Global Offering. The Selling Shareholders will be responsible for their own shares of underwriting commissions.
The Company will not receive any of the proceeds from the sale of Shares by the Selling Shareholders in the Global Offering.s
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International Placing
In connection with the Global Offering, the Company has granted the Over-allotment Option to the International Underwriters exercisable by Citi on behalf of the International Underwriters. Pursuant to the Over-allotment Option, Citi has the right, at any time from the Listing Date to November 4, 2010, being the 30th day after the last date of lodging applications under the Hong Kong Public Offering, to require the Selling Shareholders to sell up to an aggregate of 107,914,000 additional Shares, representing 15% of the initial Offer Shares, at the Offer Price to, among other things, cover over-allocations in the International Placing, if any. If the Over-allotment Option is exercised in full, the additional Shares for sale will represent approximately 3% of the Company’s enlarged share capital immediately following the completion of the Global Offering. There has been an over-allocation of 107,914,000 Shares in the International Placing and such over-allocation is covered through the stock borrowing arrangement under the Stock Borrowing Agreement between MCS Mining Group Limited and the Stabilizing Manager. Such borrowed Shares will be covered by exercising the Over-allotment Option or by making purchases in the secondary market. In the event that the Over-allotment Option is exercised, an announcement will be made. As at the date of this announcement, the Over-allotment Option has not been exercised.
Based on an Offer Price of HK$7.02 per Share, we estimate that we will receive net proceeds from the Global Offering of approximately HK4,017.9 million (Mogi: approximately 95.85% of total proceeds)from the 597,122,500 Offer Shares to be offered by the Company, after deducting underwriting fees and expenses payable by us and assuming the Over-allotment Option is not exercised.
We intend to use these net proceeds for the following purposes:
• approximately 50% (HK$2,008.9 million) for financing the Company’s mine and transportation infrastructure development projects, which currently include approximately US$125 million (HK$970.5 million) to finance a portion of the Company’s railway project and approximately US$80 million (HK$621.1 million) for the Company’s coal handling and washing plant. See the section headed “Business – Mining Operations – General” in the Prospectus;
• approximately 40% (HK$1,607.2 million) for acquisitions of companies with existing exploration rights and additional mining assets. As of the Latest Practicable Date, the Company had not identified any acquisition targets; and
• the remaining net proceeds of approximately 10% (HK$401.8 million) to fund working capital and other general corporate purposes. To the extent that proceeds are not used immediately for the purposes stated, they will be invested in short term demand deposits and money market instruments.
The Selling Shareholders will be selling a portion of their Shares in the Global Offering. The Selling Shareholders will be responsible for their own shares of underwriting commissions.
The Company will not receive any of the proceeds from the sale of Shares by the Selling Shareholders in the Global Offering.s
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International Placing
In connection with the Global Offering, the Company has granted the Over-allotment Option to the International Underwriters exercisable by Citi on behalf of the International Underwriters. Pursuant to the Over-allotment Option, Citi has the right, at any time from the Listing Date to November 4, 2010, being the 30th day after the last date of lodging applications under the Hong Kong Public Offering, to require the Selling Shareholders to sell up to an aggregate of 107,914,000 additional Shares, representing 15% of the initial Offer Shares, at the Offer Price to, among other things, cover over-allocations in the International Placing, if any. If the Over-allotment Option is exercised in full, the additional Shares for sale will represent approximately 3% of the Company’s enlarged share capital immediately following the completion of the Global Offering. There has been an over-allocation of 107,914,000 Shares in the International Placing and such over-allocation is covered through the stock borrowing arrangement under the Stock Borrowing Agreement between MCS Mining Group Limited and the Stabilizing Manager. Such borrowed Shares will be covered by exercising the Over-allotment Option or by making purchases in the secondary market. In the event that the Over-allotment Option is exercised, an announcement will be made. As at the date of this announcement, the Over-allotment Option has not been exercised.
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| NO. OF HONG KONG OFFER SHARES APPLIED FOR | NO. OF VALID APPLICATIONS | BASIS OF ALLOTMENT/BALLOT | APPROXIMATE PERCENTAGE ALLOTTED OF THE TOTAL NO. OF HONG KONG OFFER SHARES APPLIED FOR |
| 500 | 6,439 | 3,220 out of 6,439 to receive 500 Shares | 50.01% |
| … | … | … | … |
| 35,971,000 | 2 | 2,903,500 Shares | 8.07% |
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