- Thermal coal miner TerraCom (TER) secures refinancing for its debt with existing bondholders after a potential financier fell through
- The company has delayed the refinancing deadline four times
- This current bond will mature on New Year’s Eve in 2022 and has a fixed rate of 12.5 per cent per annum
- On the market this afternoon, TerraCom was in the grey and trading at 16.5 cents per share
TerraCom (TER) has secured refinancing for its debt with existing bondholders after a potential financier fell through.
The Australian coal miner had delayed the refinancing deadline four times. This current bond will mature on New Year’s Eve in 2022, December 31, and has a fixed rate of 12.5 per cent per annum.
The delayed repayments show the difficulties of refinancing thermal coal operations as banks and insurers face pressure over funding fossil fuel projects due to climate change concerns.
However, coal prices have hit a record high and demand still continues.
TerraCom says it is on target for a record December quarter in revenue and earnings before interest, taxes, depreciation, and amortisation.
Executive Chairman Craig Ransley said the company has worked hard to secure refinancing.
“Whilst it is unfortunate that the potential new financier was unable to provide the certainty to the company to finalise the refinance, it is pleasing for all stakeholders to now have a formal agreed position to move forward with our current bondholders,” he said.
“Deleveraging the company through the extinguishment of the debt over the next 15 months will increase the value proposition for shareholders as it should enable the company’s balance sheet to pivot and provide an annuity stream for shareholders through sustained dividends.”
On the market this afternoon, TerraCom was in the grey and trading at 16.5 cents per share at 12:57 pm AEDT.