Lynas announces plans to raise $83 million

Lynas has posted a massive loss, prompting a sharp sell-off late yesterday.

The rare earth miner announced its annual loss had tripled to $365.8 million as of June 30 compared to $107.4 million in the previous year.

Lynas said the multi-million annual loss reflects lower than anticipated recovery rates impacting cost of production, together with generally lower average selling prices.

The company also revealed it was aiming to raise $83 million through a deeply discounted share issue.

The new shares will be issued at eight cents each, a 30 per cent discount on its last traded price of 11.5 cents.

After the company resumed trading yesterday, shares in the company fell by nearly 25 per cent.

"We understand that we have asked shareholders to put their hands in their pockets once again but we believe it is in the best interests of the company," Chairman Nicholas Curtis said.

"This recapitalisation of Lynas is supported by substantial financial investors, some of whom specialise in investments in the energy and industrial sectors.

Curtis said a new debt payment schedule coupled with the new capital would provide a more secure financial base for the company.

Lynas owns and operates the Mt Weld rare earth mine and associated concentrate plant and the materials plant in Gebeng Malaysia.

The company said production in the June quarter was 73% higher than in the March 2014 quarter and represented 48% of full year production.

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