The FINANCIAL — Fitch Ratings said it has affirmed Zinifex Ltd's 'BB+' long-term foreign currency issuer default rating with a stable outlook, afer the base metals miner made an all cash offer for emerging nickel miner Allegiance Mining NL.
Zinifex is offering 90 Australian cents for each Allegiance share, increasing to 1 aud per share if more than 30 pct of shareholders accept the offer or the Allegiance board recommends the offer.
The acquisition of companies such as Allegiance, which will grow and diversify the business, will prove beneficial to Zinifex's creditors compared with the alternative of returning cash to shareholders, Fitch said.
Zinifex's diversification from historic narrow zinc, lead focus into nickel, the near-production nature of its Avebury asset, its low cost base and potential for expansion are all positives, the ratings agency said.
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