Bushveld Minerals Limited (AIM:BMN, OTC:BSHVF) experienced a surge in share prices on Friday morning after announcing a non-binding term sheet to refinance its roughly US$45 million convertible loan note, set to mature in November 2023.
The proposed deal with Orion Mine Finance encompasses a new three-year term loan of about US$27 million, which will be paid back in increasing capital amounts, a fresh convertible loan note of nearly US$13.5 million due in June 2028, and the conversion of around US$4.5 million of the current convertible loan note into shares at 6p per share.
Additionally, the arrangement includes a supplemental production financing agreement (PFA) capped at 0.22% of gross revenues, which will decrease by 80% upon loan maturity.
In 2020, Bushveld Minerals secured a US$65 million financing deal with Orion, consisting of a US$35 million convertible loan note (CLN) due in November 2023 and a US$30 million PFA.
Initially, the CLN was meant to fund the expansion of Vametco. However, after further analysis, it was modified to also finance the refurbishment and enlargement of Vanchem, including Kiln 3’s commissioning.
Bushveld Minerals CEO, Fortune Mojapelo, said in a statement, “The updated structure aligns the repayment schedule with our anticipated internal cash generation forecasts, providing the company with sufficient flexibility to pursue its growth goals.”
Mojapelo added, “We are eager to finalize the refinancing and further solidify our long-lasting partnership with Orion.”
The transaction hinges on due diligence, shareholder approval at a general meeting, and definitive documentation.
At approximately 9.20 am in London, Bushveld’s shares were up by 16.6% at 4.23p.
