Sprott Physical Silver Trust offer underwriters take up additional units

Suggesting institutional confidence in the future of the silver price, the underwriters in the recent $200 million offering of new units in the Sprott Physical Silver Trust have taken up $20 million in additional units.


LONDON (Mineweb) - 
The recent fully subscribed $200 million offering of new units by the Sprott Physical Silver Trust has received an additional boost by the offer underwriters - Morgan Stanley and RBC Capital Markets - taking advantage of an option that enables them to buy additional units on their own accounts.  The two underwriters have between them taken up1.8 million units, in addition to the 18.1 million units on offer at US$11.15 each, bringing the amount raised by the Trust to a little over $220 million.
As previously noted here, Sprott plans to use the proceeds to purchase, and take delivery of physical silver to the value of the amount raised, which at current silver prices would amount to some 8 million plus ounces of physical metal.

It should be recalled that when Sprott launched the Physical Silver Trust securing 15 million ounces for it took a full three months before delivery of the metal was received and, according to Sprott, some of the delivery had not even been mined when the order was put in.

What impact the purchases of another 8 million ounces of physical metal will do to the market is a little difficult to estimate - but is should be supportive at the very least.  Also the fact that two major banking institutions are willing to plough some $20 million into the trust has to suggest a certain confidence in the future of the metal, although perhaps not to the extent of Eric Sprott himself who sees huge things ahead for gold and an even better future for silver.

Sprott Physical Silver Trust, which is based in Toronto, Ontario, invests and holds substantially all of its assets in physical silver bullion. The trust is managed by Sprott Asset Management .