Vancouver – Sprott Molybdenum Participation (MLY-T) closed a highly successful initial public offering (IPO) to raise gross proceeds of $189 million on the sale of 37.8-million units at $5.00 apiece.
The fully-subscribed IPO also saw the agents fully exercise the 5% overallotment option.
Units were comprised of a common share plus a half-warrant with each full warrant exercisable at $7.50 until April 16, 2009. Warrants trade on the TSX under the ticker MLY.WT.
Sprott Molybdenum Participation was launched as a holding company to principally invest in molybdenum exploration and development companies. It also has a mandate allowing the purchase, sale and trade of the physical metal or equivalents.
With strong market interest in the hot junior molybdenum market, many investors scrambled to get a piece of the IPO as a means to “play” a larger basket of companies in addition to commercial forms of the metal.
Sprott Molybdenum will be managed by fund company Sprott Asset Management that recently purchased 3,976,000 shares of the participation company at $4.90 per share, giving it just under 10% ownership.
In early-April, primary moly-producer Blue Pearl (BLE-T, BLEFF-O) sold $36-million of its shares (3-million shares at $12.00 apiece) to Sprott Molybdenum in a private placement.
Shares of Sprott Molybdenum closed at $5.83 apiece on its first trading day with over 4.6-million shares changing hands.
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