Exxaro jumps 7% after increasing its offer of Tronox shares
Exxaro Resources’ share price jumped as much as 7% on Thursday morning, after the company said it had upped the number of class A shares it planned to sell in New York-listed titanium products company Tronox.
Exxaro now plans to sell 19.5-million ordinary shares in Tronox, from 16-million, worth about $412m, at a public offering price of $22 per share. Exxaro has granted an option to the book-running managers and underwriters of the offering to take another 2.9-million shares. Previously this was 2.4-million.
Exxaro had said on Tuesday that it planned to use the funds for capital projects‚ debt repayment and to return capital to shareholders, something that pleased the market. Exxaro also said it would sell the rest of its Tronox shares over time‚ in a staged process.
It currently owns a 42.7% stake in Tronox, which entered SA in 2011 when it merged its mineral sands business with Exxaro’s operations in KwaZulu-Natal and the Western Cape.
Exxaro’s share price had gained about 5% on Tuesday when the first cautionary announcement was made, and is up 13.55% this week.
On Thursday, Exxaro’s share price surged as much as 7.4%, before paring gains to trade 3.8% higher at R139.37 at 10am.
With Charlotte Mathews