Zimbabwe lithium miners want royalties to be linked to prices
The battery metal has slumped from a peak in late 2022 amid oversupply and weak demand from the electric vehicle sector.
Inside sources claim platinum miner Lonmin (LON:LMI) will price an upcoming share offer at a 45% discount to the theoretical ex-rights price (TERP) on Friday, with the hope of raising a total of $800 million.
Reuters reports that the company urgently needs to raise capital to lighten its debt burden following six weeks of deadly labor disputes at its mines in South Africa.
The company’s chief shareholder Xstrata (LON:XTA) holds a 25% stake in Lonmin, yet is still undecided as to whether it will participate in the rights issuance. Xstrata is currently in the middle of a protracted takeover by Swiss-peer Glencore (LON:GLEN), which is believed to have little interest in the platinum sector.
Another source cited by Reuters says there would be “strong demand” for the rights issue at the discounted price on offer.
Lonmin shares closed down 3.6% in London on Thursday.
