Fully Subscribed Rights Issue For Pike River Coal

news release
21 April 2009
Fully Subscribed Rights Issue For Pike River Coal

Pike River Coal Limited announces that its $41 million rights issue which closed on 17 April 2009 has been fully subscribed and scaling of shareholders applications for shares under the excess subscription facility has been necessary.

The issue had been fully underwritten by McDouall Stuart Corporate Finance Limited and New Zealand Oil & Gas Limited.

More than two-thirds of Pike River Coal’s 7,800 shareholders have taken up their rights entitlements for 53.76 million shares out of the total offer of 58.57 million shares. Nearly 3,000 shareholders applied for a further 12.38 million shares in excess of their entitlements.

Allocation of the 4.8 million shortfall in rights based applications for shares between Pike River Coal shareholders under the excess subscription facility and the underwriters has been undertaken in accordance with the Investment Statement. Accordingly 2.4 million shares will be allocated across shareholders and 2.4 million shares allocated to underwriters. The allocation to shareholders who applied under the excess subscription facility will be scaled on the basis of their shareholdings on the Record Date of 30 March 2009.

During the rights issue the company held a nationwide roadshow which approximately 1,100 shareholders attended.

Pike River Coal Chairman John Dow said “The attendances at the roadshow meetings reinforced the view that there is strong investor interest in the company and its prospects. We believe this has been one of the highest turnouts of investors to a public listed company roadshow for some time”.

Chief Executive Gordon Ward commented that “The successful Pike River Coal rights issue is an outstanding result given the status of equity markets generally and shows the investors’ confidence in the company and the future of our premium hard coking coal mine”.

He also said “Good progress is being made with restoring ventilation to the underground mine which is on-track to be completed by the end of May 2009”.

The ramp-up of coal production can then commence with full production using hydro monitor mining (high pressure water cutting) due to get underway in the October-December 2009 quarter.

Allotment of the shares and options from the rights issue will take place on 24 April 2009. The despatch of CHESS and FASTER holding statements will commence on 24 April 2009.

ENDS

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