Coal miner Stanmore Resources launches equity raising as coal prices hit fresh records

Coal miner Stanmore Resources has timed the launch of its $US506m ($691m) capital raising to back its acquisition of two BHP Queensland coal mines to perfection.

Stanmore Resources has timed its $US506m capital raising perfectly. Picture: Hollie Adams

Coal miner Stanmore Resources has timed the launch of its $US506m ($690m) capital raising to back its acquisition of two BHP Queensland coal mines to perfection, opening its offer amid a sharp spike in both coking and thermal coal prices on Thursday.

But, despite soaring coal prices putting a rocket beneath the stocks of other Australian coal miners, Stanmore will issue new stock at $1.10 a share – a 15c discount to its last price of $1.25.

Stanmore’s major shareholder, Indonesia’s Golden Energy and Resources, will take up only $US300m of the renounceable rights issue. GEAR cholds a 75.3 per cent interest in Stanmore, and will emerge from controlling about 64.1 per cent of its register.

The rest will be underwritten by Petra Capital.

The raising is likely to be well supported given current coal prices, and will put the finishing touches on Stanmore’s $US1.1bn acquisition of BHP’s operating share of the BMC coking coal business in Queensland.

Stanmore will acquire BHP’s share of the South Walker Creek mine, which produces PCI coal – a lower-quality coking coal used in steel mills – and the Poitrel mine, which produces a mix of hard coking coal and PCI.

PCI coal is among the hottest commodities in the market after Russia’s invasion of Ukraine, as buyers in Asia scramble to find alternatives to Russian coal.

Russia is among the biggest suppliers of PCI coal in the global market, and Wood Mackenzie analysts said that prices had spiked to unprecedented levels nearing $US400 a tonne as buyers looked for alternative sources of supply.

Originally published as Coal miner Stanmore Resources launches equity raising as coal prices hit fresh records