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Ormonde Mining (LSE:ORM) announced it has secured a deal with global investment manager Oaktree Capital Management to fund the development of its Barruecopardo project in Salamanca, Spain.
Ormonde Mining (LSE:ORM) announced it has secured a deal with global investment manager Oaktree Capital Management to fund the development of its Barruecopardo project in Salamanca, Spain.
As quoted in the press release:
The Company has entered into an exclusivity period extending to 10 April 2015 and has finalized and signed a term sheet with funds managed by Oaktree Capital Management, L.P., with regards to a financing package that would secure the funding requirements for the development of the Barruecopardo Project and a budget to conduct the early evaluation of a Stage-2 expansion of the Project. The total funding amount provided for under the term sheet is split between debt and project equity such that Oaktree would hold a majority position in the Project. Ormonde would be manager of the Project, and receive an ongoing management fee for this service. Ormonde has been assisted with the arrangement of this financing package by Swedbank Norway and Davy Corporate Finance.
Ormonde has also signed a loan agreement relating to the provision, by Oaktree to Ormonde, of US$1.5M, secured on a first priority basis by way of a share pledge of the project holding company. The loan is provided on normal commercial terms and repayable after six months from drawdown, with the repayment date being automatically extended by a period equal to any subsequent extension to the exclusivity period. This loan arrangement provides Ormonde with near term working capital as it finalises project finance arrangements.
Ormonde’s managing director, Kerr Anderson, commented:
The exclusivity arrangement with Oaktree follows a considerable period during which Ormonde, together with its advisors, have explored multiple avenues for the funding of the Project. Completion of the financing package for our flagship Barruecopardo Tungsten Project, would mean that Ormonde is in a position to rapidly advance the Project through its development stage during 2015 and towards production in the second half of 2016.
Click here to read the full Ormonde Mining (LSE:ORM) press release.