Orion looks to offload another 8.3% stake in Capstone Copper

Under the deal, the Orion funds will sell 62.4 million CHESS depository interests over the common shares of Capstone, or the equivalent number of fully paid common shares, at a price of A$9.50 each. The proceeds totalling A$592.8 million will go directly to Orion, and Capstone will not receive any proceeds from the CDI sale.

The CDIs will only be offered to certain eligible investors in Australia, plus other foreign jurisdictions where the distribution of CDIs does not require a prospectus, which would exclude Canada.

At the time of Friday’s announcement, the Orion mining funds held approximately 152.9 million common shares for an approximate 20.3% stake in Capstone. Upon closing of the secondary offering, they would beneficially own 90.5 million shares, or approximately 12.0% of Capstone’s share capital.

As part of the secondary offering, Orion has agreed not to sell any common shares or other securities of Capstone for a period of 90 days.

In early February, Orion announced the sale of 11.9 million common shares, or 1.7% of Capstone, in a bought deal offering involving RBC Capital Markets, National Bank Financial Inc. and Scotiabank. In total, the financing saw more than 68.4 million shares sold including 56.5 million by Capstone.

Capstone raised C$431.2 million from this to fund its projects in Chile, which include the Mantos Blancos copper-silver mine located in the Antofagasta region and the 70% owned Mantoverde copper-gold mine located in the Atacama region.

Shares of Capstone Copper fell 3.2% at market open in Toronto to C$8.69 apiece. The stock traded within a range of C$4.40-C$9.15 over the last 52 weeks. Its market capitalization is estimated at over C$6.5 billion ($4.8bn).