- Almonty (AII) takes another big step to securing a US$75.1 million (A$109 million) loan from a German Bank, after raising US$3.3 million in a private placement
- The company is looking to rebuild the massive Sangdong tungsten mine in South Korea and a condition of the deal was to pay certain fees
- Almonty has now paid off those fees with the help of the capital raise and is waiting on the bank to approve the big loan
- The company expects the loan to be confirmed around May 21 and it will then be able to start drawing money and developing the Sangdong mine
- Almonty has ended the day in they grey with shares closing at 85 cents each
Almonty (AII) is another step closer to getting a funding boost to reactivate and develop the Sangdong mine in South Korea, one of the largest tungsten mines in the world.
The company has raised US$3.3 million (A$4.7 million) in a private placement between company directors and existing shareholders.
The company issued over 2.8 million common shares at C 94 cents (A$1.05) per share and over 1.4 million units at US 70 cents.
Under the placement, each unit will include one common share and one-half purchase warrant with each whole warrant being exercisable at US 84 cents for 24 months from closing.
Almonty is focused on rebuilding the Sangdong tungsten mine in South Korea, and to do so, is aiming to secure a US$75.1 million loan from a German bank, KfW IPEX-Bank.
Minerals processor Plansee Group and its tungsten powder manufacturer GTP, entered into an agreement for Almonty to mine the ore and send it to Plansee/GTP for processing. The ore will be then refined into tungsten before it is sold.
The overall goal between the parties is to ‘safeguard’ the long-term primary supply of tungsten raw material.
In order for Almonty to receive the loan from the German bank, Almonty will need to make an agreement with Plansee/GTP and pay certain fees to lock the deal in.
With this capital raise, Almonty has now satisfied its part of the agreement, which means the company just has to wait for the bank to sign off on the hefty loan.
The company is expecting the loan to be confirmed around May 21 and then it will be able to start drawing money and developing the Sangdong mine.
Additionally, Almonty has seen delays in its long lead equipment for Sangdong due to global shipping delays.
Despite this, the company said it won’t delay work at the site as it has adjusted its scheduled to bring forward areas that are manufactured or planned in South Korea and pushed installation of imported items not yet in country to compensate the shipping delays.
Due to this, the commissioning date will be towards the end of the second quarter of 2023.
“What is important is to highlight that the company placed orders for all of the long lead time equipment, both milling and flotation last year in 2021, prior to the drawdown,” CEO Lewis Black said.
“This enabled us to capture pricing and delivery times on significantly more favourable terms than if ordered today.”
Almonty ended the day in they grey with shares closing at 85 cents each.