Mawson West gets over US$19mln in immediate funds, more coming
19th Dec 2014, 11:52 am by Deborah Bacal
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The company said the proceeds of the financing will be used to manage the "uninterrupted ramp up of the Kapulo copper mine through to positive cash flows and strengthen its balance sheet to manage its debt repayment requirements."
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has closed a major part of the significant financing and debt restructuring package announced earlier this month with Galena Private Equity Resources Fund, securing enough capital for the copper and silver miner to manage the ramp up of its Kapulo copper mine.
The company said Galena has provided the company with an immediate US$19.3 million in financing, and after future financing efforts already committed to by Galena are completed, total proceeds raised will be about US$33.4 million.
Galena's affiliate, Trafigura Pte Ltd., Mawson's current off-take partner and senior lender, has also provided additional financial assistance to the company through amendments to a prepayment facility and an extension to the term of its offtake agreement.
The closing of these transactions follows receiving permission from the TSX to rely on a financial hardship exemption in order to complete the deal.
The company said the proceeds of the financing will be used to manage the "uninterrupted ramp up of the Kapulo copper mine through to positive cash flows and strengthen its balance sheet to manage its debt repayment requirements."
Under the financing package, Galena has become 's largest shareholder with 41.67 million shares of the company via a C$5 million private placement.
The private equity fund has also provided the company with US$10 million secured loan facility, repayable in September 2017, as well as a US$5 million unsecured bridge loan due February 2015. Galena has also agreed to purchase additional shares of , for up to C$21.6 million.
Meanwhile, Trafigura has amended the maturity date of 's prepayment facility by 9 months to June 2017, as well as deferred US$19 million in repayments and increased the flexibility of proceeds account structure to assist with cashflow.
The intention is that both of 's projects in the Democractic Republic of Congo will be producing at "their full potential" and generating cash flow in 2015. The copper and silver producer, which is based in Perth, Australia, also owns the Dikulushi copper-silver mine in the DRC, which has been transitioning over the past year from an open pit operation to underground mining as a means to extend the mine life.
The commissioning of the Kapulo copper mine in the DRC started last month, with production anticipated to start in the first quarter. recently upgraded mineral reserves at the project, with 86 percent now in the proven category. The project is estimated to have an after-tax net present value of some US$156 million using a base case copper price of US$7,100 per tonne for the life of the mine. Life-of-mine cash costs are projected at US$1.92 per pound.
https://www.proactiveinvestors.com/companies/news/58930/mawson-west-gets-over-us19mln-in-immediate-funds-more-coming--58930.html
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