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

Thank you, stockdog.

I agree with your sentiments - though I must admit that I do have a bit of a chuckle when I read the continuing bickering between multi-username individuals.

However, those individuals should tread carefully. Whilst what they write may not be covered by the laws of libel in the UK, all posters should be aware that BBs such as this one are viewed and read throughout the world. In some countries, what is written could be considered as libel and an individual can be charged with libel in another country even though their post was placed in a country where that charge would not apply. This is one of the legal grey areas that the internet has given us.

see post 413, the multiposter has disappeared not only from this site but others too. Something has spooked him!!! Roll on kmr by the way, going great guns. starfrog get in before its to late, after doing your research of course.

still doing well but you must dyor!

Will the next few days show the SP forming a double top at 28.50p before retreating south, or carry on through to an assault on the previous high of 32p in February 1997 - now that would be something.

SD I see my friend the 6250 KMR buy bot is back...come on botty.buy buy buy.
KMR has so much going for it that long term there is only one way and that is up!
As for all the idiots saying this share is crap..I notice they have all disppeared again just like on GFM because both are doing wonderful and are going to make us a pile of dosh :-)

Too right. We're up passed the 28.50p level already today. I bet there'll be quite some selling from some relieved old investors when we hit 32p - more fool them, just when the asset is going to start producing, but it always seems to happen.

Should someone give Botty a nudge to tell him to take his finger off the button? I guess he's treating breach of hte recent high as a buy signal - which I agree with.

Just one really positive RNS and we'd be up into new territory I feel, but as ever patience is required. After all, the TiO2's not going anywhere, is it.

sd

No, but with the dollar (which most commodities are priced in) strenghtening, particularly against the Euro, it can only add more eventual profit to KMR's bottom line.

the deramper is the same ramper from AXM and it seems he has disappeared for the time being but he has got it gloriously wrong on both counts. Im glad i am doing well with this share its make up for the misery on bprg, cyh and sps!! Like you said the real profits will come in when the mine opens, until then i can see a volatile SP with profit takers and nervy investors. My advice buy on the dips but you must DYOR!

Excellent upbeat statement from the Chairman accompanying todays 2004 Final Accounts.

All looks to be on time on target with sale prices and capacity higher than planned at financing stage.

sd

http://www.kenmareresources.com/InvestorRelations/ChairmanStatement.html

A good write up in today's IC

Most of the Chairman's statement is a compilation of earlier releases, but nonetheless reassuring. For me however this is one of the key lines and is new..

"Furthermore Kenmare is in discussion with customers who have requirements which would considerably exceed the supply from the mine presently being built. We have therefore commissioned a feasibility study into an early expansion that will significantly increase the production levels"

Very good news

Yes, spotted that - nice, tempered with thoughts of fund-raising required to finance, although they have so much cash on the B/S, they even made a small profit out of interest alone last year.

Kemare is mentioned as a recovery play about to launch itself into profitabiliy in the investors chronicle!!!,wish i had kept mine,good luck to all you guys that did,am sure they will do well,LAST time i take any notice of derampers!

just noticed that on friday after the closing bell, 2 very large identical buys went through within a minute of each other. Both trades were 3,707,942 and went though at 1700 / 1701 at slightly different prices. Big institutional buy maybe ?

Stockdog

I would have thought that once the main infrastructure is in place which is on time and on budget, any expansion will result in only incremental expenditure.

Kenmare's website has now been updated to show some nice photos, maps and an animation of the process.

Another couple of big buys through after the bell - somebody must be stakebuilding.

Being for the same odd amount is this not a sell/buy roll-over with a 2 turn - so no net difference to holdings??

don't know - both showed up as buys but you may be right. we had another wierd one last week,bigger than this one.

A nice nudge up today - heading towards the all time high (31.98) last seen in 1997: