After investing $25 million in the latest $1.50 financing, Ivanhoe Mines’ (IVN:TSX) founder and Executive Chairman Robert Friedland now controls 23.8% of the company or 167,133,422 shares (and another 19,166,667 warrants).
Today, Ivanhoe announced that the Singapore-based billionaire, Friedland, 61, exercised his overallotment right as part of the financing which enabled him to acquire an additional 2.5 million units at a cost of $3.75 million.
Ivanhoe shares hit an all-time low of $1.25 (a far cry from its 2012 IPO price of $4.75 per share) in June after labour strikes in South Africa and a diminishing treasury forced the company to raise equity at a lower price than investors wanted.
The $168 million equity raise (after including the underwriters exercised greenshoe) priced at $1.50 (with a full $1.80 warrant) was 25% lower than the previous financing. The cash enables Ivanhoe to continue dewatering the historic Kipushi copper-zinc-germanium mine as well as move the high-grade Kamoa copper project through to pre-feasibility.
Ivanhoe was granted its mining right permit for the Platreef project by the South African Department of Mineral Resources on May 30th which enables them to mine what is arguably the richest platinum ore body ever discovered for the next 30 years.
That South African platinum project is well-funded after being financed at a $2.9 billion valuation by a Japanese consortium including ITOCHU Corp. and JOGMEC which saw Ivanhoe sell a 10% stake in the project for $290 million in 2011 (while the company was private).
Since hitting lows in June, shares of Ivanhoe have churned higher and are now near the finance price of $1.50.
Disclosure: I am long Ivanhoe Mines. As a result I am biased. Always do your own due diligence.