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

Definitely NOT a rollover. Sold at different prices and as an ORDINARY trade. I wish I could side with you but have a real bad feeling about this one over the next week. All the bad rumours and the slide in the share price along with the heavy selling off (don't forget the 11 million sell-off a few days back) tell me to keep avoiding this one until times get better. Too many good shares to profit on without getting involved in a lottery. Who needs that?!!

Of course they were done at different prices. The holder of the 500k sold them at 23.00 and then bought them back within a few seconds for 23.10p. You can't roll over at the same price as the MM won't make any money on the deal. As far as the trades showing as ordinary trades, of course that is the case. The holder of the 500k simply sold them for 23.00 and bought them back again for 23.10. Both trades will show up as O trades.

Prepare yourself for the big sell-off this afternoon chaps -and the bad news tomorrow! Don't say you weren't warned!!!

Nothing but blue buys since the early few sells today. Price rising.

What is the significance if any of so many automated trades - are these just automatic limit buys from porgramme traders?

SD

If you can sell your shares for 22 or 23 pence you'll do well. After today you'll be lucky to get 18!!!

Pro or misinformer or Pitted Face whatever your name is this week. You never have anything but gloom and doom to impart. Clear off to another share, preferably not one of mine. I suggest everyone just squelch this idiot as he/she never has anything of interest to say and cannot ever back anything up with evidence of any sort. So Pro you are squelched!

Consider him duly squelched.

Interesting day for KMR...how many people paniced and sold at 21p only to see the price go up to 24p all in a day...I think KMR has just suffered a concerted shorting exercise and now it is buy buy buy again...It just proves the best stragegy is hold hold hold IMHO. This share and GFM are only going one place long term and that is up up up.
Di

I held tight, but I must admit being put off buying more by the irritants on this thread. Was on my list, but I went for EPD and topped up CFP and DOO at good prices - so can't complain.

Nice to see the rebound - phew!

SD

Don't let them put you off SD that's what they want :-)

SD / Di - I agree with you , I've been a long term holder in KMR and believe that there is much more to come.

On another subject where can I find out what the various letters mean against trades - O / L / X etc etc ?

I don't know but O is ordinary, L late T Trade B Broker to broker.
Di

jimwren
Go into HELP, once clicked it gives you a home page, then click on TRADES - Full definitions are available there of all the capital letters used by the brokers in determining the trades.

bankone

thank you

It looks like the (bad) news flow is now due out early next week.

I cannot see what Pro has to say as I have squelched him, however, please note that multiple deramper Pro aka informer, brat pitt lookalike, 1Pro etc has also been slated as a serial deramper and waste of space on ADVFN on the KMR boards too. I suggest everyone just squelches him and they are doing the same on the other side too.
Di

It would appear, from a conversation that I have had with a 'friend', that a large number of Kenmare warrants are to be exercised "in the very near future". I am led to believe that this will see a dilution of the KMR share price by over 20%. As a consequence of this, it can be deduced that the share price will fall below 20 pence.

Yay..KMR is doing well again today...bet everyone's glad they stuck with it now.
:-)

Di, it's been a good time to buy the market in the gloom of a negative week which we're just exiting it seems. Only regret I can't buy 'em all. 22/23p was definitely a buying op for KMR last two days. Still be happy with those you have - soon be leaving that price in the dust.

SD

SD I have made a note that I must keep money spare for just before Easter and Christmas when volumes are often low and prices of all shares drift down. I have no money spare so I couldn't buy more which is annoying as I bought more KMR only last week!
Di