LONDON (Thomson Financial) - Mexico's Industrias Penoles S.A.B. de C.V. will spin off its precious metals assets into the Fresnillo Group and plans to list the company on the main market of the London Stock Exchange in May.
Fresnillo, the world's largest primary silver producer, is estimated to be worth about $8 billion and is a potential FTSE 100 candidate.
Proceeds from the new shares in the initial public offering, expected to be about $900 million, will be used by Fresnillo to re-pay existing debt and to finance expansion plans.
The company did not disclose possible proceeds from the sale of existing shares. However implied proceeds of about $1 billion can be estimated as Penoles said it expects to retain about three quarters of the company following the offering.
Fresnillo, Mexico's second-largest gold producer, produced about 34.4 million ounces of silver and approximately 280,000 ounces of gold in 2007 and aims to double silver output within the next 10 years and increase its gold production.
Importance: Sounds like extending privatization to me...
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