The best performer on the All Ordinaries index on Thursday has been the Altura Mining Ltd (ASX: AJM) share price.
The lithium miner’s shares were up as much as 20% to 11.5 cents in early afternoon trade. They have since dropped back a touch, but are still up almost 15% at the time of writing.
Why did Altura Mining’s shares storm higher?
This morning Altura Mining advised that it has become aware that Shaanxi J&R Optimum Energy Co. Ltd has sold 251 million of the company’s shares on-market this morning. This represented approximately 11.8% of the issued shares of Altura Mining.
This isn’t the first time that Shaanxi J&R Optimum had sold the lithium miner’s shares. Over the last few months it has been reducing its holding in the company through a series of trades.
But it will be the last time it sells Altura Mining’s shares. Management advised that it understands that today’s sale completes the divestment process and welcomed the development.
Whilst having one of your major shareholders and offtake partners selling their considerable interest isn’t ordinarily a good thing, I suspect that its periodic selling has weighed on the company’s shares and was part of the reason they have recently been trading at a 52-week low.
Investors may believe this has dragged its shares lower than necessary and left them trading at an attractive level.
The latter is starting to recover after a series of sharp declines this week following the release of an update which revealed plans to reduce its production in June and July to conserve cash flow and working capital during a period of weakening demand.
The Galaxy Resources Limited (ASX: GXY) share price is bucking the trend and has fallen 2% today.
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Motley Fool contributor James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.