BMR may issue discounted shares to fund bid

11th May 2011 16:36

Miner and metals processor Berkeley Mineral Resources got a bit of a bashing on Wednesday as it proposed to place 145m new shares at 4p each, well below the prevailing mid-market price.In addition to the new placing shares the company will issue one warrant for every two placing shares subscribed for, with the warrants exercisable at 6p each at any time in the three years after issue.The company needs the funds for a potential acquisition of a business located in Zambia. Berkeley Mineral (BMR) is currently seeking preferred bidder status but stresses there is no guarantee it will be accorded this status or that the proposed acquisition will be consummated. If the acquisition falls through then the proposed placing will be aborted."The potential acquisition will advance the company's plans by 10 months, thereby transforming its prospects. Combined with the agreements that we have in place at Kabwe, which we expect to finalise shortly, and Luanshya it will further enhance BMR's near term future," said Masoud Alikhani, chairman of BMR.---jh