TORONTO--(BUSINESS WIRE)--Almonty Industries Inc. (“Almonty” or the “Company”) (TSX: AII / ASX: AII / OTCQX: ALMTF / Frankfurt: 1MR) is pleased to announce an update in relation to the KfW US$75.1 million loan facility.
Almonty advises that it is in receipt of the completion of conditions precedent letter from KfW. Almonty has now satisfied all of the 110 conditions precedent.
Once the balance of the equity has been transferred to the loan account held in Korea by Almonty Korea Tungsten Company (AKTC) and the payment of various financing fees is completed, which are customary to project finance lending, the bank can then move to issuing the drawdown letter and the first drawdown will commence.
Almonty’s Chairman, President and CEO Lewis Black commented:
“This is a monumental occasion for Almonty and its shareholders, with the drawdown of the KfW US$75.1 million loan now imminent after approximately five years of hard work, due diligence and co-operation by all stakeholders.
The completion of the loan for US$75.1 million from KfW means that the largest tungsten mine outside of China, with one of the highest grades in the world and located in South Korea, the largest per capita user of Tungsten globally, is now positioned to complete construction as intended.
I firmly believe this has been worth the effort and patience required by shareholders, with the KfW loan facility attracting very low interest rates, with an all-in cost expected to be approximately 2-3%. The quality of the lender and their ongoing support for our continued growth will be a decisive factor for Almonty’s continued success and will allow us to respond to the changing demand dynamics that we are now witnessing within the technology sector.
The timing of the drawdown could not come at a better time from a tungsten market perspective, with the tungsten price up 45% in the past 12 months to US$338 per MTU, at a time when we are experiencing increasing demand from sources outside of China, particularly in the South Korean and EU semiconductor and battery sectors.
We are currently approximately 15% through total construction of Sangdong and now, with drawdown of the KfW loan, the Company can accelerate construction towards commissioning which is on track for Q4 CY 2022. Our underground development is over 27% complete and is already 6 months ahead of schedule. I am immensely pleased that we decided at Almonty to secure and fix pricing last year on much of the equipment on order which has shielded us from more recent inflationary equipment price rises.”
The general terms of the loan facility approved by the credit committee of KfW-IPEX include:
- The principal amount of senior project finance loan to be US$75.1 million;
- Interest rate -- three-month London interbank offered rate (LIBOR), plus 2.5 per cent. LIBOR will be replaced by SOFR. (Secured Overnight Financing Rate);
- Term of 6.25 years with an initial principal repayment holiday during construction and quarterly instalment repayments of principal commencing after the second anniversary of the initial drawdown; and
- Oesterreichische Kontrollbank AG (OeKB) is committed to providing an import credit scheme cover guarantee based on the previously announced long-term offtake agreement, which was issued in February 2020.
About Almonty
The principal business of Toronto, Canada-based Almonty Industries Inc. is the mining, processing and shipping of tungsten concentrate from its Los Santos Mine in western Spain and its Panasqueira mine in Portugal as well as the development of its Sangdong tungsten mine in Gangwon Province, South Korea and the development of the Valtreixal tin/tungsten project in north western Spain. The Los Santos Mine was acquired by Almonty in September 2011 and is located approximately 50 kilometres from Salamanca in western Spain and produces tungsten concentrate. The Panasqueira mine, which has been in production since 1896, is located approximately 260 kilometres northeast of Lisbon, Portugal, was acquired in January 2016 and produces tungsten concentrate. The Sangdong mine, which was historically one of the largest tungsten mines in the world and one of the few long-life, high-grade tungsten deposits outside of China, was acquired in September 2015 through the acquisition of a 100% interest in Woulfe Mining Corp. Almonty owns 100% of the Valtreixal tin-tungsten project in north- western Spain. Further information about Almonty’s activities may be found at www.almonty.com and under Almonty’s profile at www.sedar.com.
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