The Irish mining group said the new revolving credit facility will be used to finance future capital projects and expansion.
Kenmare Resources, the Irish mining company, has tapped a consortium of international banks to secure a new $200 million debt facility.
On Tuesday, the listed mining group announced it had agreed a five year revolving credit facility worth up to $200 million with a syndicate of four international banks; Absa, Nedbank, Rand Merchant Bank and Standard Bank.
Kenmare said the new debt facility, which includes an overnight interest rate of 4.85 per cent, will replace its current corporate debt agreement, which was first agreed in 2019 and carries a higher interest rate of 5.4 per cent.
Under the terms of the new debt facility, the Irish mining group said the syndicate of international banks will share a $50 million security package, with signing closing and initial drawdown expected to take place in March.
Tom Hickey, finance director at Kenmare Resources, said the new debt facility would help the mining group finance future expansion projects in Mozambique, where the company operates the Moma mine.
“The new $200 million revolving credit facility supports our planned capital programmes in the coming years. It removes the amortising payments of the existing term loan, whilst increasing the size of available facilities and extending the maturity profile from 2025 to 2029,” Hickey said.
“The new facilities continue our strong relationship with existing lenders and provide enhanced financial flexibility through the revolving credit structure and committed five-year term,” he added.
Kenmare is one of the world’s largest producers of titanium minerals and the single largest supplier of ilmenite – products which are used in the manufacture of paper, plastics, fabrics, cars and other household items.
Last year, the company announced a $24 million share buyback programme after reporting half year revenues of $230 million and profits of $68 million. Shares in Kenmare Resources are down almost 40 per cent in the last 12 months to value the group at just over $300 million.
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