Atlantic lines up $20 million from major shareholder

Battling vanadium miner Atlantic has secured an additional $20 million in high interest debt to fund continued development at its Windimurra mine in the Mid West.

Atlantic announced today it had signed an agreement to raise the funds through the issue of new class D convertible bonds to its largest shareholder, Droxford International.

The bonds will be used to partly fund a half-yearly interest payment on Atlantic subsidiary MidWest Vanadium’s $US335 million senior secured notes, and will also go towards the ongoing ramp up of operations at Windimurra.

Atlantic said it also reached agreement with Droxford to convert an existing promissory note and related arrangement fee to class C convertible bonds with a $35.3 million face value.

The new class C and class D bonds are convertible at 26.25 cents per share, and have an interest rate of 22.5 per cent per annum, to be paid semi-annually in arrears.

Conversion of the bonds remains subject to Foreign Investment Review Board approval.

Also today, Atlantic said that its reimbursement due under the Australian Taxation Office’s Research and Development Tax Incentive Program was now expected to be $27.3 million, up from previous estimates of $24.3 million.

The reimbursement will allow Atlantic to secure a $15.3 million short term funding facility with a “leading Australian bank”.

At close of trade today, Atlantic shares were down 2.5 per cent, at 19 cents.