Pike River calls for trading halt ahead of rights announcement

By NZPA

Friday 25th January 2008

Listed coal miner Pike River Coal today called for a trading halt in its shares pending an announcement related to a rights issue.

On January 16, Pike announced a $100 million funding package to
help meet extra costs as it neared completion of its West Coast hard coking coal mine.

The company is launching a $60m rights issue to existing shareholders and a $40m convertible bond issue to investment fund Liberty Harbor, managed by Goldman Sachs.

Managing director Gordon Ward said the capital raising would replace an existing funding arrangement with Westpac.

Ward said $35m was needed in addition to the Westpac facility to see the mine development through to completion.

One of the current facility's detractions was that it would not have allowed Pike River to draw down those costs until it had hit the coal seam, he said last week.

The early July target to hit the seam is two months later than its last forecast, but Ward said the slower pace would lessen the risks involved.

Pike shares were up 2 cents on 97 cents before the suspension.

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