Australia’s Metro Mining Ltd. announced this week that it has entered into a financing agreement with Nebari Natural Resources Credit Fund I, LP and Nebari Natural Resources Credit Fund II, LP (“Nebari”) of up to US$30 million. Proceeds from the facility will be used to expand its operations at Bauxite Hills Mine in Queensland, Australia.
Metro has issued a drawdown notice for US$20 million of the loan, with the remaining US$10 million available to the firm upon its satisfaction of certain conditions. Maturity is in four years, and Metro is not obligated to make payments on it for the first 24 months.
Metro’s creditors on a separate secured debt of A$35 million welcomed the facility and agreed to subordinate their loan to the facility. They also agreed to defer repayment of the principal on their note by 12 months.
Simon Wensley, CEO & Managing Director of Metro, said in a press release that the new funding is proof positive of the potential at its Bauxite Hills Mine project.
“We are extremely pleased to announce this financing package following a competitive selection process. It is a testament to the strong fundamentals of the Bauxite Hills Mine expansion, positions Metro to deliver greater volumes of bauxite to its customers at a time of rising bauxite prices, protects shareholder value, and offers future flexibility. We are pleased to welcome Nebari as our senior lender, having worked through an extensive due diligence process. I thank our shareholder lenders, Jim Gorman at Ingatatus and Greg Willims at Lambhill, who have supported the project at every turn for a long period. I am pleased that the existing and new lenders share our view of the future value of the Bauxite Hills Mine operation.”
Andre Krol, Managing Partner of Nebari, was complimentary of Metro’s operations.
“We are extremely excited to partner with Metro as they pursue this margin and value accretive expansion of Bauxite Hills. The experience and professionalism of the Metro team are impressive and we are confident they will deliver on their targets.”
Metro Mining is based in Brisbane and began life when it was spun off from Cape Alumina Ltd. upon its takeover by MetroCoal Ltd in 2014. The firm has exploration rights in over 500 square miles of western Cape York, which is second to only Rio Tinto Alcan.