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

comment on earlier post also
All you say humpback321, may be true, although it smacks of Company puff. The words "...ramp up...production...covenants broken..."
-may also be true, but is NOT the same as fact. We are in a World-wide recession and where is this "extra" production going? Whilst it's not a "new" product, so it requires no expensive "marketing" - but the World does not have a shortage-demand for this material - whatever is currently being used will reduce - and- no amount of "covenants" will change that.
These inescapable facts are the reason for the sp slide and then there is "Debt" - -or-is this about the only company that has funded its operations to date? I doubt it.......Also, look at the history of this Irish stock . . .. years-and-years-and . . . . still we wait....bargepoles IMHO....currently 11p oh dear.
(-If it's any comfort, I have a few stocks in the same position!)
EDIT (20Dec08):- Dir buys 1m @8p, currently 7.9p for us Retail investors - (down 10% today) - - & I don't see folks filling their boots...

hp - because they said so

Target level 66,000 tons of product per month by june 09 was stated.

50,000 in september. 66,000 easy peasy

On the move?

any views on future of this ??

Chairmans yearly statement due about 14th april.

What future?, no one bothers to keep us long suffering holders in the picture. Any one thinking of adding or indeed buying in KMR. needs a visit to his/her GP. This board continue to under preform whilst failing to update us on their failings, hence the very,very steep decline in the SP. The silence is deafening as the SP. dwindles.

The directors seem to have bitten off more than they can chew, looks as though this one may be left in the hands of the bankers.

Well the only consolation I can draw from that, is that they have lost more than me! well I hope they have. Its a crying shame that their bundling and incompetence has resulted in turning a once in a life time opportunity into a complete farce. Carvill & Carvill a comic duo with no equal that is apart from Brown & Darling.

KMR announcement-new lending terms agreed-full productiom second half of this year-prelimary results and annual report later this month.

Terrific comeback by Kenmare since results, it seems that they are getting their act together at long last !, and by the way what ever happened to their uranium exploration ?, i not heard anything about that for ages....perhaps it is somewhere deep in the last Rns...must have a forage about to see what I can find !.

For anyone unaware KMR. are one of several companies presenting at tomorrows minesite mining forum. If it proves successful the bounce should continue.

Up up and away?

Moma mine reaches breakeven point------this level of production means that the company has more than crossed the cash operating cost breakeven point------significant point in our development.Charles Carvill, chairman. ( part of todays statement, Annual General Meeting ).

Proactive Investors One2One Forums

The directors of Ascent Resources (AIM: AST), Blue Energy Limited (ASX: BUL) and Kenmare Resources (AIM: KMR) will be presenting:

Thursday the 16th July 2009

Chesterfield Mayfair Hotel, 35 Charles Street, Mayfair, W1J 5EB

The presentations will start at 6:00pm and finish at approx 7:30pm. After the presentations are complete the directors will also be available to take questions during a free canapand wine reception. Details on the presenting companies can be found below.


Register Here - http://www.proactiveinvestors.co.uk/register/event_details/55

If you have any problems registering or queries please email action@proactiveinvestors.com

Thanks for info.Andy.

humpback321,

My pleasure, if you are based around London, these events are well worth attending in my opinion.

I frequently attend, and there is a good balance of industry professionals, brokers, analysts, and small private investors, and a "club" atmosphere during the informal drinks session afterwards.

Are you planning to go?

Andy,possibly,trying to organise a long weekend with my missus as we live in the north-east.

Don't forget this excellent chance to meet the CEO this week!

Proactive Investors One2One Forums

The directors of Ascent Resources (AIM: AST), and Kenmare Resources (AIM: KMR), and Blue Energy Limited (ASX: BUL) will be presenting:

Thursday the 16th July 2009
Chesterfield Mayfair Hotel, 35 Charles Street, Mayfair, W1J 5EB

FREE registration : http://www.proactiveinvestors.co.uk/register/event_details/55

The presentations will start at 6:00pm and finish at approx 7:30pm. After the presentations are complete the directors will also be available to take questions during a free canapand wine reception.

These presentation evenings are well worth attending, and the networking afterwards is an excellent opportunity to meet the CEO's as well as other private investors.

If you have any problems registering or queries please email action@proactiveinvestors.com

Nearest tube stations are Green park (5 minutes walk), and Bond Street (7 minutes).