Lonmin says $400 million rights issue undersubscribed

by Reuters 0

Beleagured platinum producer Lonmin said on Friday its deeply discounted $400 million share issue was undersubscribed with about 71 percent taken up.

The company, which is seeking cash to stay afloat, said it had received acceptances for 19 billion new shares as of Dec. 10 out of 27 billion shares it is selling to shareholders at 1 pence each.

The rights issue was underwritten by HSBC, J.P. Morgan Cazenove and Standard Bank. Lonmin said they now need to find subscribers for the balance of nearly 8 billion new shares by no later than Dec. 14.