Copper, Gold Power Australian Indexes

Darlington Musarurwa
24 Dec, 2009
New York City

Stocks in Australia gained after copper and gold advanced in international markets. Centro Properties appoints restructuring advisors. Warrnambool Cheese receives two proposals that value the company at A$4 a share. Woodside Petroleum keels nine leases in Browse natural project.

[R]3:00 AM New York, 7:00 PM Sydney – Stocks in Australia gained after copper and gold advanced in international markets. Centro Properties appoints restructuring advisors. Warrnambool Cheese receives two proposals that value the company at A$4 a share. Woodside Petroleum keels nine leases in Browse natural project.[/R]

Australia stocks rose leveraged by rising commodity stocks as the greenback weakened.

Trading was shortened on the eve of Christmas. In Sydney trading ASX 200 Index rose 1.1% or 51.6 to 4,790.90.

Of the ASX 200 index stocks, 146 gained, 36 dropped, and 18 were unchanged. Murchison Metals led gainers in the index shares with a rise of 6.3% after gold prices rose 0.7% to $1,094 per ounce and crude oil prices jumped 3.1% to $76.7 per barrel.

The Australian dollar edged up 0.3% to 88.22 U.S. cents.

Centro Appoints Advisors for Restructuring

Centro Properties Group announced today that it has appointed J.P. Morgan Australia Ltd. and Moelis & Company LLC as co-advisers to restructure the company. Centro Retail Trust also appointed UBS AG.

UBS AG and J.P. Morgan Australia will work “in a collaborative basis” during the assessment phase to be completed by mid-2010.

“The objective of the assessment phase is to identify the means by which the enterprise value of the Centro group can be maximised and to separately identify and analyse execution risks,” said the company.

Centro Raises $2.2 billion in Convertible Bonds

The Times reported today Glencore has raised $2.2 billion in convertible bonds from private equity companies and sovereign wealth funds. The company currently has $9.3 billion in debt as noted on its Web site.

According to the report, the bonds will convert into stock, valuing the trading company to $35 billion if it seeks an IPO.

Glencore bonds were purchased by equity firms First Reserve and BlackRock Inc and the Government of Singapore Investment Corporation.

Glencore own 34.5% in Swiss mining company Xstrata and 9.7% in Russia based United Co. Rusal. The company is likely to list its shares in a public offering in either London or Hong Kong.

“This transaction, in which Glencore is opening up its equity capital to outside investors, marks an important milestone as we embark on the next stage of our corporate development,” said the company.

ASX Movers

DEXUS Property Group led the decliners in the S&P ASX 200 index with a loss of 2.3% followed by losses in Elders Ltd of 2.3%, in IOOF Holdings Limited of 2.2%, in Abacus Property Group 2.2% and in GPT Group 1.6%.

Murchison Metals Limited led gainers in the S&P ASX 200 index with a rise of 6.2% followed by gains in Gunns Limited 5.1%, in Extract Resources Limited of 4.6% and in Carnarvon Petroleum Limited of 4.5%.

Other Movers

BHP Billiton plc added 1.3% to A$42.47 after the mining company said Chinese and Japanese copper smelters remain locked in talks over copper treatment and refining charges with the company after agreeing a 38% cut with Freeport-McMoRan Copper & Gold Inc.

Centro Properties Group climbed 6.1% to A$0.26 after it appointed advisors for restructuring.

DEXUS Property Group fell 2.3% to A$0.82 after the completion of US property sales of $177 million, as part of the A$600 million property sale program announced in April. The company also sold A$115 million of Australian property since June 30, 2009.

Gunns Limited the forest management and development rose 5.1% to A$0.91.

IOOF Holdings Limited the offering a range of financial products dropped 2.2% to A$6.04.

Murchison Metals Limited gained 6.2% to A$2.38.

Warrnambool Cheese and Butter Factory Company Holdings Limited surged 23.6% to A$3.40 after the company received two takeover proposals. The offers valued the company at A$160 million. The company rejected both offers and asked shareholders not to take any action.

Woodside Petroleum Ltd advanced 0.3% to A$47.50 and the company said it will issue 31,211,631 to institutions and additional 28,646,808 to retail investors at a price of A$42.10 each.

Separately the company also agreed to a deadline of April 2010 to decide how it plans to develop its natural gas project at Browse field in exchange to keep the nine leases in the field.