ivanhoe australia to list , page-5

Ivanhoe back for another joust
Email Print Normal font Large font AdvertisementBarry FitzGerald
June 20, 2008

BILLIONAIRE miner Robert Friedland is seeking $125 million from a float of the Queensland copper, gold and uranium exploration interests of his Canadian-listed Ivanhoe Mines.

Best known locally for his arrivals by a private Boeing jet at the annual Diggers & Dealers bash in Kalgoorlie and his early call on the China boom, Mr Friedland first looked to list Ivanhoe's local interests in a $90 million float last year, backed by Macquarie.

But that fell victim to equity market wobbles caused by the subprime crisis in the US. He is now back seeking $125 million, with UBS as sole lead manager and bookrunner.

Because the float comes without any published stock exchange-compliant resource estimates, it amounts to one of the biggest mineral exploration floats ever.

But that is Mr Friedland's style. A terms sheet for the float says that "Ivanhoe does things differently than the average exploration company".

Mr Friedland made his fortune with the discovery of the Voisey's Bay nickel deposit in Newfoundland by his Diamond Fields Resources, which was sold to INCO for $5 billion.

More recently he enticed Rio Tinto to throw its weight behind Ivanhoe's Oyu Tolgoi copper/gold project in Mongolia, a project he picked up from BHP Billiton for a now embarrassing - to BHP - $US11 million in 2000. Oyu Tolgoi is one of the world's next great mine developments, with Rio recently pumping $US1.5 billion (through investing in Ivanhoe) on securing a one-third stake.

Under that deal, Rio took a 9.9 per cent stake in Ivanhoe at a cost of $US303 million as part of a broader plan to invest $US1.5 billion to take its eventual stake to 40 per cent, subject to a development agreement with the Mongolian Government.

Ivanhoe will be keeping 80 per cent of Ivanhoe Australia (IA), implying a market value for IA on listing at the issue price of $2 a share of $625 million. IA has an inter-company loan with Ivanhoe of $74.7 million, of which $30 million will be satisfied with proceeds from the float. The remainder is earmarked for a typically aggressive exploration/development program.

IA's focus is on the Cloncurry region in Queensland where the hunt is on for iron oxide, copper/gold deposits such as Ernest Henry (Xstrata) in the same region and Olympic Dam (BHP Billiton) and Prominent Hill (Oxiana) in South Australia.

http://business.smh.com.au/ivanhoe-back-for-another-joust-20080619-2tl1.html