Shares in South African black-owned mining group Exxaro slid on Wednesday after mining group Anglo American said it would sell 19-million Exxaro shares, nearly halving its stake.
Exxaro shares were 4,5% lower at R74,50 by 8.10am GMT, having pared losses after earlier tumbling 6,4%. The Top-40 index of blue chip stocks was flat.
Anglo said in a statement the book had opened for the placing to global institutional investors and pricing and allocations would be announced as soon as possible.
Once the sale is complete, it will reduce Anglo’s stake in Exxaro to 10% from 18,3%.
RMB Morgan Stanley is acting as global bookrunner and Morgan Stanley and Company and Rand Merchant Bank are acting as joint financial advisers in the transaction.
Exxaro was spun off from Kumba Resources last year and merged with unlisted Eyesizwe Coal to form the country’s biggest diversified black-owned mining firm.
It has interests in coal, mineral sands, base metals, industrial minerals and iron ore. The firm is South Africa’s fourth-largest coal producer, with coal capacity of 45-million tonnes per year. – Reuters