Omnia announces successful capital raising to fund future expansion
- Published: Monday, 13 September 2010 11:00
OMNIA ANNOUNCES SUCCESSFUL CAPITAL RAISING TO FUND FUTURE EXPANSION
Omnia today announced that its Rights Offer of R1 billion which closed on Friday 10 September, attracted subscriptions totaling R2.02 billion - an oversubscription of 102%. The proceeds of the rights offer will be used for the construction of a R1.4 billion world class Nitric Acid complex in Sasolburg.
Commenting on the results of the offer, Rod Humphris, Omnia Group Managing Director, said:
“We believe the very positive response to the offering represents a significant milestone in the history of Omnia and demonstrates the faith that our shareholders have in the future growth and development of mining and agriculture in the Southern African region. The growth in both agricultural and mining markets has been driven by international demand and development trends which are set to continue. This milestone investment in our new Nitric Acid complex lifts Omnia onto a new growth and development path that will not only benefit Omnia in the coming years but also play a significant role in contributing to food and energy security. We have been building the market for the off-take of this Nitric Acid complex for the past ten years and this investment will also enable Omnia to meet further increased demand in both mining explosives and fertilizers, allowing us to leverage supply side synergies between these businesses and ensure security of supply to our agricultural and mining customers.”
This will be the first Nitric Acid plant of its kind to be built in South Africa since 1984. It represents a milestone 30 year investment in the development of South African capacity to produce Nitric Acid and Ammonium Nitrate - bringing world class technology to local shores, and guaranteeing the supply of critical raw materials to Omnia’s downstream mining and agriculture businesses.
The plant will produce c. 1,000 tons per day, which equates to 140% of the existing plant’s capacity. The plant is estimated to operate at 60% capacity level on startup. Ramp- up to full capacity will take place in line with growth in the explosives and fertilizer markets.