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

All the conflict, adispute, arguments and insults bandied about regarding Kenmare only serve to show that the share just simply isn't worth the risk. If I want to risk good money then I shall do so -but on another share.
African Diamonds is one that is waiting to move quite quickly quite soon. I bought at 64p earlier in the week then topped up nicely at 60p when people sold. It's now 65p and much better value than Kenmare will ever be.

The weekly update.
afd = 65p
kmr = 27.5p

I admire and respect your decision.

Bye

SD

informer

no insults, just a question. When you talk about the weakness of KMR are you basing it some technical analysis of its SP or on the prospects for the Company?
Do you believe that KMR's MOMA mine has no potential ?

Good luck with AD

Informer, there is a thread specifically for AFD - please talk about it there and not here.

jimwren, no, Moma is just a pipe-dream. Rampers put it forward to gullible people telling them it's a dream-come-true for tomorrow. No such thing. It's a pipe-dream! I've sold Kenmare and am simply putting the alternative argument.

ive read all your posts on most sites under all of your handles, but you have not given one reasoned argument against. You just keep saying 'sell' and 'dont buy' but not one reason. Unles you call ''its just a pipe dream'' an argument. Go to the KMR website, is that a figment of somebodys imagination or just pipe dream?

I bet you say annoying things like 'i can't see the wood for the trees' or 'we'll have to suck it and see' (apologies to anyone who use those annoying phrases, brings back bad memeories of lecturer at uni who could never give you a straight answer, bit like informer really) and tell me were you bullied at school?

Hey man, all this bitchin about man, like cos someone expresses an opinion. Like it's a free country man and if someone feels that Kenmare resources is a bad share then they're entitled to that opinion man, like without being slagged off. Sounds like you holders of Kenmare shares are real insecure people man and afraid of something real bad if one guy can rattle you all so much. Maybe you should sell your shares man if you aint so confident and buy into something that gives you a bit more confidence.

Hey man, check this out man:

African Diamonds:...Buy:.155,948.....Sell:.1,300
Kenmare: ...........Buy:.nothing!!...Sell:23,947

No contest!!

hey man, do one!

informer

can you expand a bit on your "pipe dream" theory ? MOMA doesn't exist ? The finance is not in place ? Offtake agreements have not been signed ? Construction hasn't started ? Independent analysis hasn't taken place ?

Are you operating on some conspiracy theory or are you just seriously weird? We would all love to know.

Kivver, Jimwren...Brad is just a complete twit, nutcase, plonker etc...Squelch him and then you don't need to see any of it ..I have.
Di

Squelching is a bit like sticking your head in the sand man. Really weird, you know. Bit like buying this share man.

KMR has dropped back a bit so i thought I would buy some more. IMHO KMR will be worth a few pounds in 2-3 years so I am looking on this as a long term investment and I am now overweight in KMR. Of all the aim miners KMR is the safest bet for the future and I would hope to 10 times my money at least over the next few years. I shall tuck them away and forget about them.
Di

This from Mining Weekly is encouraging, especially the last bit.


http://www.miningweekly.co.za/min/essentials/update/?show=60920

Moma titanium mineral sands project
--------------------------------------------------------------------------------

Name of the project and location
Moma titanium mineral sands project, Mozambique.

Project description
The mine will be built on the coast of the northern province of Nampula, where heavy sands contain world-class deposits of titanium minerals. It is expected to produce 600 000 t of rutile a year.

Value
$450-million. Kenmare has received approvals for 55-million from the European Investment Bank and $40-million from the African Development Bank. In addition, the Multilateral Investment Guarantee Agency (Miga), a member of the World Bank group, has issued guarantees of $20,8-million in aggregate to Kenmare and Kreditanstalt f Wiederaufbau (KfW) for proposed equity and loan investments in the project. The other member of the Moma project, Lender Group, is expected to complete its internal loan approval processes when satisfactory development contract terms have been agreed.

Duration
The construction phase of the project will last two years, after which the facility will produce more than 650 000 t/y of titanium minerals.

Breakdown of main contracts
Siemens will be providing a complete engineered electrical solution for the entire mine including on-site power generation, power distribution, automation and communication, drive systems and associated electrical equipment. The contract will also include the refurbishment and delivery of selected components from the dismantled Beenup Minerals Sands plant in Australia.

Siemens will also be responsible for engineering, installation, commissioning and training. After-sales support will be coordinated by the Siemens regional office in Mozambique. Client
Kenmare Resources.

Latest developments
Siemens Industrial Solutions & Services has been awarded a contract to supply a complete turnkey electrical solution for the project. The order will include the design, engineering, installation and commissioning of the electrical solution for the mine as well as a 170 km 110 kV overland transmission line.

Participants
African Development Bank, the Development Bank of Southern Africa, ECIC (the South African Export Credit Agency) and Absa (the South African commercial bank which proposes to lead the banks funding with the ECIC guarantee), the European Investment Bank and KfW (the German development financing institution).

Multiplex and Bateman in a joint venture will be the contractor for the project.

Siemens will be responsible for the engineering, installation, commissioning and training.

Will the project require the use of structural steel and if so how much?
Not stated.

On budget and on time?
Yes.

Hey man this says absolutely nuthin man!
Kenmare is being sold off again today man ...so remember, people aint so dumb!!
Stop your rampin man and get real. Mining company African diamonds (AFD) is really flying man.

Mr Pitt,you are a bore.

Squelch him :-)

What do I have to do to squelch?

Click on his name on this thread and press Squelch
Di