News

June 16, 2008

ZincOx Closes The Financing For Its Ohio Recycling Project, To A Mixed Reception

By Alastair Ford

Andrew Woollett would have liked it announced on Monday, but the deal was signed off on Thursday night, and the lawyers ruled on an immediate release. So first thing Friday morning, Zincox Resources told the market that it’s raising US$120 million through a placing at 175p per share and a three year bond facility. This fundraising, long anticipated in one form or another, will enable the company to construct its zinc, slag and iron recycling plant in Ohio. And it turned out that the lawyers were right to assess the news as market sensitive: an initial surge of enthusiasm in London took the shares to within spitting distance of 200p; but the market then changed its mind at around lunchtime and by the end of the day’s trading had knocked nearly seven per cent off Zincox’s valuation. The shares closed at 172.5p, a 12 month low. Market sensitive? These markets are not only sensitive, but fickle too.

“The news is great, but the market is the market”, said Mr Woollett, Zincox’s chairman, towards the close of trade on Friday, with a corresponding mixture of enthusiasm and resignation in his voice. The company is now fully funded through to production from the Ohio plant, and although Zincox isn’t exactly a conventional miner these days at one level it seems fairly clear that the company has long been suffering from the usual lack of interest in development stage companies in the mining...