Augusta JV signs mandate letter for Rosemont loan2013-08-09 08:45 ET - News Release
Mr. Gil Clausen reports
AUGUSTA ANNOUNCES SIGNING OF PROJECT FINANCING MANDATE LETTER
Augusta Resource Corp.'s wholly owned subsidiary, Rosemont Copper Co., together with its joint venture partners, LG International Corp. and Korea Resources Corp., have executed a project financing mandate letter with a syndicate of 12 international financial institutions (the mandated lead arrangers, or MLAs).
The mandate letter sets out an exclusive arrangement with the MLAs describing the activities needed to arrange a limited recourse loan facility for the construction of the company's Rosemont copper project in Arizona. The proposed senior secured loan is expected to provide all of the debt required for Rosemont, including a cost overrun component. The mandate letter sets forth the required steps, including agreement on final terms and conditions, and requisite documentation for the loan, completion of due diligence and procurement of credit approvals, as well as time frames for completing these steps. The mandate letter also specifies the roles and responsibilities of the MLAs, appoints certain MLAs to agent roles, and stipulates certain fees payable to the MLAs and agents.
The 12 MLAs who have signed the mandate letter include: BNP Paribas, Commonwealth Bank of Australia, Credit Agricole Corporate and Investment Bank, Export Development Canada, Export-Import Bank of Korea (financial advisory and structuring department), ING Capital LLC, KfW IPEX-Bank GmbH, Korea Development Bank, Korea Finance Corp., Korea Trade Insurance Corp., and Mizuho Bank Ltd.
The MLAs are being advised by Shearman & Sterling LLP (lenders' counsel), DeConcini McDonald Yetwin & Lacy PC (lenders' Arizona counsel) and SRK Consulting (U.S.) Inc. (lenders' independent engineer).
The sponsors are being advised by Endeavour Financial International Corp. (financial adviser), Allen & Overy LLP (project finance counsel), Fasken Martineau DuMoulin LLP (corporate counsel to the company) and Fennemore Craig PC (sponsors' Arizona counsel).
"The signing of the mandate letter represents a significant step forward towards completing project financing for the construction of Rosemont," said Gil Clausen, Augusta's president and chief executive officer. "The high-quality, large-scale and strong economics of this project, combined with its favourable location in Arizona, make it an attractive candidate for financing from the international banking community. This step illustrates that progress for finalizing our financing is keeping pace with Rosemont's permitting process, which is rapidly nearing completion in the coming months."