B.H.P. 1:8 rights issue at 400c

Press, 7 August 1976, Page 16

B.H.P. 1:8 rights issue at 400c

Broken Hill Proprietary Company, Ltd, (8.H.P.) is to raise S9BM through a one-for-eight rights issue, according to a Press Association report from Melbourne.

The directors said about 24.5 M shares are to be issued at a premium of 200 c each — making the issue price 400 c. Payment for the shares will be in two equal instalments, the first due early in December, 1976, and the second in April, 1977.

The directors said they expected to maintain the current annual dividend rate on the increased capital.

The S9BM will be used to finance further development of the group’s interests in minerals, steel and petroleum, the directors said. The funds will also be used for general purposes, they added.

Full details of the issue, including the date of closure of books, will be announced towards the end of August.

In addition to the shares issued to shareholders, 200,000 shares are to be allocated on the same terms between the B.H.P. Wages Employees Retirement Fund and the B.H.P. Staff Superannuation Fund.

The theoretical value of the rights — based on a

last sale price of $10.30 — will be around 475 c, with the shares averaging down to about 970 c. However, this theoretical value will be even more subject to market forces than usually, because of exchange rate differences between New Zealand and Australia. (B.H.P. shares rarely sell at the correct exchange equivalent with the Australian price) and the restricted market for Australian shares in New Zealand.

B.H.P. is to purchase the 41.8 per cent shareholding of Burmah Oil Company, Ltd, of the United Kingdom, in Woodside-Burmah, N.L.

The price is $68.5 million, or about 91c a share. With the consent of the stock exchanges B.H.P. does not propose to make an offer for the publicly held shares in WoodsideBurmah. The directors of B.H.P. consider that the oportunity for the public to invest directly in the venture should be preserved by allowing Woodside-Burmah to remain a listed company. The purchase is conditional upon B.H.P. satisfying itself on certain commercial matters by August 31. The arrangements are expected to be completed on September 1, on which day the first payment of S3SM will be made, with the balance payable on October 1.