UPDATE 1-Freeport suspends dividend, cuts oil & gas capex

Wed Dec 9, 2015 8:50am EST
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Dec 9 (Reuters) - Diversified U.S. miner and oil producer Freeport-McMoRan Inc said it had suspended its annual dividend of 20 cents per share to save cash amid a slump in commodity prices.

The dividend suspension is expected to result in annual cost savings of about $240 million and enhance its liquidity, the company said on Wednesday.

Freeport, under pressure from activist investor Carl Icahn, further reduced its capital spending plans for 2016 and 2017 on Wednesday.

The company also said it was looking at other financing alternatives, including a potential sale of minority interests in certain mining assets.

Freeport cut 2016 capital expenditure budget for its oil and gas operations by 10 percent to $1.8 billion, and slashed its 2017 budget by 40 percent to $1.2 billion.

The company, in October, said it will add two new directors to its board under an agreement with Carl Icahn. Icahn owned 8.8 percent of Freeport as of Sept. 22.

Shares of the miner, which were up marginally at $6.87 in premarket trade, have fallen 71 percent this year. They closed at $6.74 on the New York Stock Exchange on Tuesday. (Reporting by Sneha Banerjee and Darshana Sankararaman in Bengaluru; Editing by Shounak Dasgupta)