Jupiter returns to Australian bourse

PALLINGHURST, the diversified mining company, yesterday announced the return of Jupiter Mines to the Australian Securities Exchange (ASX) in a move that will give international investors access to one of the world’s biggest manganese deposits.

Jupiter listed on the ASX yesterday after four years and raised A$240 million (R2.2 billion) through the issue of 600 million shares at 40 Australian cents a share, valuing the company at A$780m.

In 2014 Jupiter, which was 18.4 percent owned by Pallinghurst, delisted from ASX as the company believed its valuation was too low at the time.

Pallinghurst, which was founded by mining tycoon Brian Gilbertson, said yesterday that it had raised A$83.1m from the listing process, selling up to 212 028 012 of its Jupiter shares at 40 Australian cents a share.

The initial public offering (IPO) has significantly reduced Pallinghurst’s exposure to Jupiter to 145 845 372 shares, valued at A$58.3m at the IPO price, with Pallinghurst saying it would hold on to its Jupiter shares.

“Pallinghurst will hold these shares for realisation at an appropriate later time and has agreed to restrict the sale of this remaining interest for up to approximately 20 months under the escrow arrangements detailed in the Jupiter prospectus.”

It said Pallinghurst would, in relation to its remaining shares, expect to benefit from the strong performance signalled by Jupiter, including the possibility of further Jupiter share buybacks.

Useful Des Mayers, an analyst at Afrifocus Securities, said the IPO was good news for the company.

“The cash will be useful to reduce debt which came about following the acquisition of Gemfields.

“It also vindicates management’s decision that the Jupiter investment was going to be lucrative from a shareholder point of view,” Mayers said.

Pallinghurst acquired Gemfields, the UK-headquartered supplier of coloured gemstones, and bought out its minority shareholders in a shake-up that rattled the market.

Mayers said the challenge for Pallinghurst was now to get Gemfields to generate substantial profits following significant changes several months ago.

Jupiter has a 49.9 percent share in Tshipi é Ntle Manganese Mining, which operates the Tshipi Borwa manganese mine in South Africa.

Tshipi Borwa exceeded its production and profitability targets for the year to February 2017, generating a cash balance of more than R1.5bn at year end.