WHEN casting an investment fishing line towards shareholders' wallets in search of £41 million it's advisable to have the hook well baited and to scatter some fat grubs on the water, some words about asset security and prospects and a healthy return on investment will fit the bill.
David Hough, managing director of Irish exploration company Ivernia West, baited his hook this week with the tempting morsel of participation in the Lisheen lead/zinc mine in Co Tipperary, an ore bearing deposit of nearly 18 million tonnes, possibly the largest lead/zinc mine to be developed in western Europe in recent years.
Ivernia West, which has a 50 per cent interest in Lisheen, is raising £41 million from shareholders, using the revenue to finance its share of Lisheen development costs and also to make inroads into debt repayment. The Ivernia board is understandably upbeat about Lisheen's potential, estimated to produce about 1.5 million tonnes of ore per day and have a lifespan of 13 years. Mr Hough believes the mine "will generate substantial revenues and cash flow throughout its life". Hooked on this pleasing scenario, shareholders were reeled in with the prospect of what was termed a "generous dividend policy" with payments possibly beginning shortly after production commences. With the fish safely on the bank, the "priest" (an angling tool which, allegedly, painlessly puts the fish out of its misery) was produced from the corporate kit bag. Apparently with sufficient funding in place, "there will be no further rights issues". Amen to that.
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