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Lynas chases $200m for rare earths plant

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MELBOURNE, Nov 9 AAP

November 09 2012, 1:46PM

Lynas Corporation is to raise $200 million of new capital, just days after a legal win in its battle to operate a rare earths plant in Malaysia.

The funds raised will be used for working capital and general corporate purposes during the commissioning and ramp-up at the Lynas Advanced Materials Plant in Malaysia.

Lynas on Thursday received Malaysian court permission to begin operating a controversial processing plant in Gebeng, Malaysia.

The Kuantan High Court ruled against Malaysian activists that had sought an injunction against Lynas' temporary operating licence for the plant.

The capital raising will involve a fully underwritten institutional placement to raise up to $150 million and a partially underwritten share purchase plan available to all existing shareholders to raise up to $50 million.

Lynas said in a statement on Friday that the capital raising would give it positive cash flows to meet capital expenditure requirements and provided a significant cash buffer to allow for unforeseen events.

Lynas shares are in a trading halt and due to resume trading on Monday.

The raising is underwritten by JP Morgan.