AfriTin Standby Working Capital Support Financing
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
22 May 2019
Bushveld Minerals Limited
("Bushveld Minerals" or the "Company")
AfriTin Standby Working Capital Support Financing
Bushveld Minerals Limited (AIM: BMN), the AIM listed, integrated primary vanadium producer, with ownership of high grade vanadium assets in South Africa announces that it has agreed to provide a short-term standby working capital support facility to AfriTin Mining Limited ("AfriTin") to the sum of ZAR30,000,000 (approximately US$2.1 million) ("Standby Facility"). Bushveld Minerals spun-off its non-core tin business in 2017 to create AfriTin and currently holds 9.5 per cent of the issued capital of AfriTin as available for sale.
The 12-months facility is meant to fund AfriTin's working capital requirements leading to expected tin mine commissioning this year, and subsequent longer-term refinancing. The Standby Facility is secured against a general notarial bond over the AfriTin's processing plant at Uis project.
The Facility may only be drawn down by AfriTin subject to the following conditions:
· AfriTin can reasonably demonstrate to the Company that it anticipates the generation of revenues which will enable it to repay the amount drawn down in full.
· AfriTin furnishes the Company with evidence it has succesfully completed an equity fundraising by way of a direct subscription of 99,613,074 ordinary shares at a price of 3 pence per share to raise approximately £3 million;
· Bushveld Minerals is satisfied that AfriTin has utilised the funding available to it under the equity fundraise and that AfriTin's other available cash resources have been utilised in full;
· Bushveld Minerals is satisfied that ATM does not have positive cash flow (determined in accordance with the same accounting principles applied by AfriTin during the 6 months prior to the Signature Date);
· The Standby Facility shall be used by AfriTin exclusively for the reconfiguration of the installed pilot plant tin production circuit at its Uis tin project in accordance with the Bushveld Minerals reviewed technical plans to commision a mine at Uis project.
Interest on the Standby Facility accrues at a rate of 12.5 per cent per annum (payable quarterly) on drawn amounts, and a facility fee equal to 1.0 per cent of the facility amount. The Standby Facility is repayable at any time during the 12 months term at no additional cost to AfriTin. The facility is issued at arms length terms.
Fortune Mojapelo, CEO of Bushveld Minerals Limited, commented: "While we remain committed to our Board's decision to see AfriTin exist and operate as an independent company, we saw it appropriate to provide much needed once-off standby funding for the company's work towards imminent mine commissioning. On the basis of our due diligence conducted on the tin project, Bushveld is confident of risk mitigation measures put in place to protect the Company from exposure to events of default.
Furthermore, the funding support provided gives AfriTin the needed time to finalise its own longer-term debt financing on the back of anticipated tin production at Uis project later this year. The support provided therefore enables Bushveld Minerals to secure value in its remaining shareholding in the company and thereby facilitate for the eventual final exit from the tin business by the end of the facility term."
ENDS
Enquiries: info@bushveldminerals.com
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Bushveld Minerals |
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+27 (0) 11 268 6555 |
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Fortune Mojapelo, Chief Executive Officer |
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Chika Edeh, Head of Investor Relations |
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SP Angel Corporate Finance LLP |
Nominated Adviser & Broker |
+44 (0) 20 3470 0470 |
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Ewan Leggat / Richard Morrison |
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Jonathan Williams / Richard Parlons |
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Alternative Resource Capital |
Joint Broker |
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Rob Collins |
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+44 (0) 207 186 9001 |
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Alex Wood |
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+44 (0) 207 186 9004 |
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BMO Capital Markets Limited |
Joint Broker |
+44 (0) 20 7236 1010 |
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Jeffrey Couch / Tom Rider Michael Rechsteiner / Neil Elliot |
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Tavistock |
Financial PR |
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Charles Vivian / Gareth Tredway |
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+44 (0) 207 920 3150 |
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Brunswick |
Financial PR (South Africa) |
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Miyelani Shikwambana |
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+27 (0) 11 502 7300 |
ABOUT BUSHVELD MINERALS LIMITED
Bushveld Minerals is a low cost, integrated, primary vanadium producer, with ownership of high grade vanadium assets.
The Company's flagship vanadium platform includes a 74 per cent controlling interest in Bushveld Vametco Alloys (Pty) Ltd, a primary vanadium mining and processing company; the Mokopane Vanadium Project and the Brits Vanadium Project.
Bushveld's vision is to become a significant, low cost, integrated primary vanadium producer through owning high grade assets. This incorporates development and promotion of the role of vanadium in the growing global energy storage market through Bushveld Energy, the Company's energy storage project developer and component manufacturer. Whilst the demand for vanadium remains largely anchored in the steel industry, Bushveld Minerals believes there is strong potential for an imminent and significant global vanadium demand surge from the fast-growing energy storage market, particularly through the use and adoption of Vanadium Redox Flow Batteries.
While the Company's focus is on vanadium operations and the development and promotion of VRFBs, it has additional investments in coal, power and tin.
The Company's approach to project development recognises that, whilst attractive project economics are imperative, they are insufficient to secure capital to bring them to account. A clear path to production within a visible timeframe, low capital expenditure requirements and scalability are important factors in ensuring a positive return on investment. This philosophy is core to the Company's strategy in developing projects.
Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com.
About Vametco
Vametco is located near Brits on the Western Limb of the Bushveld Complex. The integrated operation comprises a vanadium ore mine and a processing plant that produces NitrovanTM, a trademark product sold in major steel markets across the world. The mine lies adjacent to the Brits Vanadium Project, which will in future serve as an alternative source of near surface run of mine (ROM) ore feed to the Vametco plant.
The Vametco mining operation uses open pit bench mining methods to mine a well-defined orebody. The deposit is continuous with limited faulting and dips in a northerly direction at approximately 19 degrees.
ROM ore is fed into a primary, secondary and tertiary crushing circuit, followed by milling and magnetic separation to produce magnetite concentrates. The magnetite concentrates are fed into the extraction process which includes the kiln for roasting followed by leaching and precipitation. Thereafter the precipitated vanadium as ammonium metavanadate is converted to modified vanadium oxide ("MVO") in rotary calciners. MVO is fed into the mixplant and finally into the shaft furnaces to produce NitrovanTM.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
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