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Here’s why the Perenti (ASX:PRN) share price is edging higher

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The Perenti Global Ltd (ASX: PRN) share price is edging slightly higher in late-morning trade today. This comes after the company provided an update on its sale of the Yanfolila and Boungou assets.

At the time of writing, the mining services company’s shares are swapping hands for $1.135, up 2.2%.

Let’s take a look at what’s driving the Perenti share price up today.

What did Perenti announce?

In today’s release, Perenti advised it has received around $80 million from asset sale of the Yanfolila Mine in Mali, and the Boungou contract in Burkina Faso. The agreed early exit from these two projects was a result of the underperforming contracts announced in its half-year results.

The sale comprises of roughly $55 million from the loss-making Yanfolila asset, and $25 million from the Boungou Mine asset. This includes the sale of in-country plant, property, and some of the equipment.

The remaining in-country equipment, settlement of outstanding debtors and working capital balances is expected to be finalised in the coming months.

Commenting on the sale, Perenti managing director and CEO Mark Norwell said:

With the receipt of these funds, as outlined when we presented our 2021 half-year results, we will redeploy this capital across our business into our most value accretive opportunities as we seek to generate and maximise value for our shareholders.

Perenti share price summary

Established in 1987, Perenti is one of the world’s largest companies that provides surface and underground mining and support services. The group is headquartered in Australia, and has operations and offices across 11 countries.

Over the past 12 months, the Perenti share price has shot up close to 50%, but has fallen 16% year-to-date. The company’s shares reached a 52-week high of $1.60 in June 2020 on the back of a positive business update.

Perenti has a market capitalisation of roughly $802 million, with about 704.3 million shares on issue.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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