Sprott Launches IPO Fully Subscribed and raises $189 Million

Resourcex
0 Comments|April 17, 2007

Moly lovers get a participation stock


Moly lovers get a participation stock

Sprott Molybdenum Participation (TSX: T.MLY, BullBoards) has settled into its second day on the TSX at a comfortable $5.72, up 72 cents from its successful IPO yesterday. On Monday, the company sold 37.8 million units at $5.00 each, bringing in a total of $189 million.

Purchasers received one share and one half of a warrant. Each warrant entitles shareholders to purchase one common share in the fund for $7.50 until April 16, 2009. The IPO was fully-subscribed and saw the agents fully exercise the 5% overallotment option.

According to the Sprott Molybdenum Participation (SMP) website www.SprottMoly.com, Sprott Chairman and Chief Executive Eric Sprott created the fund as an investment holding company that will invest in Molybdenum assets such as the securities of public and private companies, as well as physical molybdenum.

The Sprott Molybdenum Participation fund recently purchased 10% of moly exploration company, International PBX (TSX: V.PBX, BullBoards). Sprott management purchased a total of 20% of the junior, for a total of $7 million.

In April, moly-producer Blue Pearl (TSX: T.BLE, BullBoards) sold three million of its shares at $12 each to Sprott Molybdenum for a total of $36 million in a private placement.

There has been strong interest in the junior molybdenum market recently, with many analysts suggesting further upside in the white metal's price, since little has been added to supply. The molybdenum market is considered very tight.

According to SMP director Denis Battrum's March 2007 essay, "Structural Changes in Molybdenum Demand," "Molybdenum is undergoing significant structural change on both the supply and demand sides which makes a return to earlier price structures unlikely."

Doug Hadfield is the Chief Editor of the Resourcex Investor, an internationally distributed newsletter specializing in identifying as-yet-undiscovered resource companies representing the best in their class. For more information, visit the website www.resourcexinvestor.com.

-->


StockHouse Conflict and Disclosure Policy:

Stockgroup Media Inc., owners and operators of StockHouse.ca/com, has established rules to ensure that there is no appearance of impropriety on the part of any StockHouse writers who discuss or name individual public companies in the content published on the StockHouse websites. The content of StockHouse Editorial articles are the opinion of the writer and any reliance on the content of these articles shall be at your sole risk.

StockHouse Editorial writers may own, buy, or sell shares in public companies mentioned in their articles. Please be advised that a conflict may exist and that any investment decisions you make are your own responsibility. Additionally, our Editorial writers are not registered investment advisors. You should not make any kind of investment decision in relation to these articles or stocks discussed in them without first obtaining independent investment advice from a registered investment advisor.

Facts relied upon by our Editorial writers in arriving at their opinions are generally provided by the subject companies or gathered by our Editorial writers from other public and/or private sources. These facts may be in error and if so, the opinions of our Editorial writers may be materially different.

Rules applying to StockHouse Editorial Writers

StockHouse Editorial writers may own stock of any company they cover, but at the bottom of the article or within the article they must clearly and prominently state their ownership position in the company.

StockHouse Editorial writers cannot solicit, accept, or agree to receive anything of value given or paid with the intent of influencing their editorial articles published on StockHouse.

StockHouse Editorial writers are not permitted to write articles that attempt to influence or benefit persons connected to the writer such as family or friends, , except where disclosure is made in the same way as if the writer him/herself owns stock.

StockHouse notifies each Editorial writer about these rules but in case of a possible breach of our rules, we may not be in a position to find out or investigate the facts. We rely on the integrity of our writers to ensure that our rules are followed.


Tags:

Rate this article
3 stars
v
Usefulness

Clarity

Credibility
Add to favourites icon Add to favourites

Comments

No comments yet. Be first to comment!

Leave a Message

You must be logged in to access this feature.

Featured Company