The newly established Minerals and Metals (MMG) group is comfortable with its current financial situation and will not rush to tap Australian equity market to raise funds, MMG chief executive Andrew Michelmore said yesterday.
Speaking in a teleconference following the release of the company’s September quarter production report, Michelmore said equity raising may be an action in the company’s future.
“Accessing the equity markets would be to raise funds and at this stage we don’t need those capital funds and as we grow the business we would look at various ways of raising funding and equity is obviously one of those,” he said.
MMG was formed in June this year as the Melbourne-based arm of Chinese State-owned Minmetals, which bought the majority of OZ Minerals’ mining assets for $1.73 billion.
Michelmore’s comments follow last week’s decision by the Foreign Investment Review Board (FIRB) to greenlight Yanzhou Coal’s $3.5 billion takeover of Felix Resources based on the condition the Chinese company floats at least 30% of the miner and other Australian assets on the ASX by the end of 2012.
While Michelmore pointed out the fact that Minmetals’ approval from FIRB featured no such demand to list in Australia, the MMG parent company was still considering it.
“I think that is one way to demonstrate the openness with which these companies are going to consider their investments and it is a positive thing,” he said.
According to its production report, MMG’s total ore output rose 13% in the September quarter, producing 3.497 million tonnes, up from 3.086 million in the previous corresponding period.
The company attributed much of the increase to additional ore accessed at its Sepon copper and gold operations in Laos.