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Philex pushing through with P13.81-billion share sale

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MANILA - Philex Mining Corp's shares fell today after the company announced that it will push through with a plan to raise P13.81 billion through a stock rights offering.

In a disclosure to the Philippine Stock Exchange, Philex said it already registered such a plan before the Securities and Exchange Commission (SEC) last March.

Each Philex shareholder of record as of October 16, 2013 can avail of the right to subscribe to additional shares commensurate to their existing holdings. The rights offer will run from October 21 to November 4 with listing scheduled on November 12.

At the close of trading today, Philex dropped 7.7 percent to P9.12 a share from yesterday's P9.88.

Philex tapped HSBC as the sole global coordinator and joint lead underwriter, and BDO Capital & Investment Corp as the domestic issue manager and joint lead underwriter along with BPI Capital Corp.

The company said the proceeds of the rights offering would be used to settle P5.9 billion worth of debt and finance capital expenditures, including the exploration of two mining prospects, the Silangan and Kalayaan. 

Philex had borrowed P2.1 billion from controlling shareholder First Pacific Co Ltd last November.

The company had to shelve the rights offering after the government suspended operations at the Padcal copper-gold mine, which accounts for bulk of Philex's revenue. It however registered the rights offering after the government last March allowed Philex to temporarily resume operations to speed up repair ahead of the rainy season.

To recall, Philex suspended operations at Padcal more than a year ago after accidentally spilling mine tailings or waste into nearby Agno River and Balog Creek. The government has since fined the company at least P1 billion for the pollution.

Despite the setback in Padcal, Philex has proceeded with exploration at the Silangan project, production from which would commence by 2017. The area covers the Boyongan and Bayugo deposits.

Exploration drilling also has commenced at the Kalayaan project, which adjoins the Bayugo deposit. Both the Silangan and Kalayaan projects are in Surigao del Norte.

Philex aims to produce 35,000-60,000 metric tons from the Silangan project. The company has yet to disclose estimates for the Kalayaan project.

InterAksyon.com is the online news portal of TV5, which like Philex is chaired by Manuel V. Pangilinan.

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