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Fortescue plans capital raisingFebruary 23, 2009 - 11:25AM
Fortescue Metals Group plans to raise an unspecified amount of capital this week, it said on Monday, without giving any further details.

The Australian Financial Review reported on Monday that Fortescue planned to raise $500 million with a share sale to institutional investors and Chinese steel maker Hunan Valin Iron and Steel.

It said JPMorgan and Southern Cross Equities would be lead managers for the share placement.

Fortescue's spokesman Cameron Morse would not confirm or deny the report.

The company called a halt to trading in its own shares, pending the announcement. Shares last traded at $2.83.

Citing unnamed sources, the newspaper also said Valin was in talks to buy part of the 15.9% stake in Fortescue held by US hedge fund Harbinger Capital, which has been looking to sell down its stake in Fortescue over the past 18 months.

Australia's third-biggest iron ore miner needs to raise money to help fund the expansion of its mine and port facilities to more than double its production capacity to 120 million tonnes a year.

Fortescue recently appointed JPMorgan, Azure Capital and Grant Samuel to help it review approaches it has received from several parties, including mining giant Anglo American and China's sovereign wealth fund China Investment
Corp.