From the FT on the 19th June

http://search.ft.com/search/article.html?id=040619001094&query=kenmare&vsc_appId=totalSearch&state=Form

COMPANIES UK & IRELAND: Kenmare negotiates $269m loan
By John Murray Brown
Financial Times; Jun 19, 2004



One of the largest debt financings for an independent mining company was announced yesterday when Kenmare Resources agreed a $269m (146.5m) facility to develop the Moma titanium mine in Mozambique.

Drawdown of the debt is contingent on the Irish company raising equity of $79m, lifting the value of the project to $345m.

The company already has commitments of $55m from a number of large investment funds.

Documents will be posted to shareholders on Monday for an open offer to raise up to $42m.

A banker at NM Rothschild, lead advisers on the financing, said the debt package represented three times Kenmare's market capitalisation of $90m.

"I do not think there have been any listed mining companies who have done that," he said.

Among the lenders, the African Development Bank is lending $40m and the European Investment Bank $15m in senior debt and a $40m subordinated loan, reflecting the vital economic benefits to what is the poorest region of one of Africa's poorest countries.

Martin Curwen, of the EIB, said this was the first deal signed under the 2000 Cotonou agreement between the EU and African, Caribbean and Pacific countries.

He said EIB's presence would "provide comfort" to other lenders. "It is part of our mandate to support projects where the funding would not have been available from the financial markets," he said at yesterday's signing ceremony, attended by Castigo Langa, Mozambique's minister of mineral resources and energy.

KFW, the German development finance institution, is providing $50m, partly tied to the supply of electrical equipment by Siemens.

The Dutch development agency FMO is lending $15m. The only commercial bank involved is ABSA, the South African bank, which is lending $80m to support the purchase of South African goods and services by the mine.

The mine is expected to be in production in the second half of 2006, with annual output of 600,000 tonnes of ilmenite and other titanium minerals that supplies white pigment used in paint and toothpaste.

The company has already raised 4m to purchase a mineral separation plant in Western Australia, which is being dismantled and shipped to the site.

At full production, the mine will account for about 5 per cent of world supply. About two-thirds of world production is controlled by RTZ and Iluka, an Australian company spun out of the old Rennison Goldfields.

FT Comment

* There have been similar financings in the minerals sector but never where the borrowing is three times the borrower's market valuation. The Lihir gold project in Papua New Guinea raised $300m in 1995 but lenders had the comfort that Rio Tinto Zinc owned about 40 per cent of the company. Kenmare's project is 100 per cent-owned by Kenmare, a company that has no cash flow and would have reported a small loss of $40,000 last year but for interest on its bank deposits. This project clearly could transform its fortunes. There are offtake agreements in place for more than half the first five years' production with Dupont and Mitsui. Prices for mineral sands tend to be more stable than base metals, which behave more like a commodity dependent on capital goods demand. The current market cap is little more than the value of a year's production from the mine. An upgrade seems inevitable. Canaccord, the company's broker, has a current price target of 35p. This compares with a close of 17p, down 2p yesterday.


Copyright The Financial Times Ltd

Still on the rise chaps!

As a holder for well over a year, patience needed with this share, it will get where you want it to go but in its own time.

Looks like it is in a new trading range now instead of the 14p to 20p one of old, which is nice :-)

capa

4 times the value in buys against value of sells! Seems like people are getting the picture about this share!

I'm happy today with nearly all my holdings-0-:) etc. only NRG is letting me down. can't win em all I suppose.

pro, is there any news due soon on this share, I took the opportunity to get aboard yesterday in the dip, short lived though it was

Not that I'm aware of, but with a company that's got all the right credentials, like KMR has, any sudden uplift in price may just as easily be put down to share-buyer astuteness rather than news. You got in at a good time. Well done!!!

Very rewarding day with KMR.L!!!

News due re further offtakes, increasing capacity of production facility, progress report on mine. There is also the possibility of an offer for the company. Michael Carvill said last June that the company had recieved offer(s). However no timeframe for the news so could come at any time.

Chuffing hell !!!!!!

capa

lots of automatic trades going through today, how silly they are! no profit taking for me thats for sure.

I see the robot is a 'Buy Bot' today and on our side, lets hope they don't put him back to sell again later.
Di

It occurs to me all these automated trades might be spread bet/CFD firms continuously trimming their books to lay off the risks of their clients' constantly changing positions. Is this possible?

I see there are a number of sell 6250's going through now.

It occurs to me that this is one heck of a good share to buy. Quite a bit of activity right now and the share price seems to be building momentum. Right time to buy I think. One columnist recently wondered if Kenmare might be the next Asia Energy, and look how that has flown!!!

Monday morning andit's no blues for the Kenmare chappies!!! Flying again and money for nothing!!!

I see KMR started the day with our friend the 'buy bot' again. I am beginning to like him well until he sells that is.
Di

I believe there was a positive article in yesterday's Sunday Times...appreciate if anyone can post this.

Joe,

I part read the money & business sections and didn't see anything. will check it out and get back to you

Here it is - doesn't say a whole lot, except quantify annual operating profit projections at $62m. What EPS does this translate into?
SD


ShareWatch: Stronger Kenmare in bid rumours
EDITED BY FRANK FITZGIBBON






SHARES in Kenmare Resources, a natural resources explorer with a full listing on the Dublin and London exchanges, have been remarkably strong since the beginning of the year. At Fridays close of 24.75p (36.1c) in London, they are boasting a 48% increase since the turn of the year, valuing the business at 160m. The run-up in the price has led to all sorts of market rumours, inevitably focusing on the possibility of a takeover bid.

One of the names mentioned as a possible suitor for Kenmare is 250m AIM-listed Asia Energy, whose primary activity is the development of an open cast coal mine at Phulbari in northwest Bangladesh.




Rumours of an imminent bid were rife last week but one seasoned observer described the Asia Energy link as unlikely.

The future of Kenmare is tied into the success or otherwise of its Moma titanium minerals project. Equity financing for this Mozambique-based venture was completed last November. As previously noted in this column, Moma is is expected to bring in annual revenues of $85m (66m) over 20 years with operating costs at $23m a year over the same period.

I believe the reason this share has increased in value is because the price of ti has increased by 40% since the end of November - have a look at all the major metal suppliers historicle prices and you will see an increase of 30% at the beginning of December and a further increase of 10% last week. Some massive trades whent through at the beginning of December think someone was awake to the price of ti. If you add 40% to KMR share price at end of Nov you get 26.5p coincidence no.

The 1st thing we need to do is track the ti price, its not easy as there is no spot price for it, but when the likes of Sumitomo and others state & quote prices this gives us an indication of what the price is.

Thanks for the info in TI price Gull, very positive indeed! Coincidence? This share was expected to be a slow burner last year, with price taking off as it got closer to production. But nothing happened till this year. Included in many peoples 'share of the year', press reports including AEN of 2005?????, AEN takeover??????? Maybe a bit OTT, but this share has a target of 35p, 57p if they add additional machinery and increase production. The family that are the major shareholders are on record as claiming that they would not accept 38p last summer and it was then 17p!
IMHO they will be taken over before production starts, and your TI info makes that even more likely. But they have pre-sold some of the first few years production at agreed prices.