Shares in nickel miner Minara Resources jumped 7.5% yesterday after it said it would return $111 million of capital to shareholders because of its strong financial position.
The shares rose 5c to 71c at the close yesterday.
The Perth-based company says it will ask its investors at an extraordinary general meeting on August 17 to approve a return of capital to shareholders of 9.5 cents per share.
"Minara has been able to undertake a capital management program due to its strong financial position," chief executive Peter Johnston said in a statement yesterday.
Mr Johnston said the cashed-up company had surplus cash from a $210 million rights issue in December 2008.
"A number of factors, including increases in the prices of nickel and cobalt and improvement in the outlook in the global economy, have seen Minara generate positive operating cashflows, building its cash reserves to $363 million as at 30 June," he said.
The company said that no part of the 9.5 cents per share returned to investors will be deemed a taxable dividend under a class ruling by the Australian Tax Office.
Swiss commodities giant, Glencore International will get 70% of the return. It controls Xstrata as well.
New Zealand resin manufacturer, Nuplex Industries, yesterday squelched media and market talk that it was talking to Orica to sell its chemicals trading unit.
A short two paragraph statement flatly denied the story.
The shares had jumped to a day’s high of $2.45, up 14c and the biggest rise this year so far.
They later settled up 9c at $2.40, for a gain of 3.9% for the day.
The media reports said that Orica and Nuplex are the largest wholesale distributors of chemicals in Australia, with a combined 20% of the market.
The two companies were reported to be in talks to merge their units and then divest by a public share offer or trade sale.
We might find out more today when Orica shareholders meet in Sydney to vote on the spin-off of its DuluxGroup paint and garden products business as it focuses more on mining services.
Nuplex, which makes resins used in paints and construction materials, may also be in talks with Covington, Kentucky-based Ashland Inc. on its chemical unit, the media reports said.
Interestingly, the statement from Nuplex yesterday made no reference to this part of the media and market reports.
