25/05/2015 - 12:51

Iron ore project in $US1.5bn refinancing

25/05/2015 - 12:51

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Mid West iron ore miner Karara Mining has completed a $US1.48 billion refinancing of its bank debts, providing a share price boost for its part owner Gindalbie Metals.

The Karara operation in the state's mid-west.

Mid West iron ore miner Karara Mining has completed a $US1.48 billion refinancing of its bank debts, providing a share price boost for its part owner Gindalbie Metals.

The funding has been used to repay syndicated facilities falling due in 2020, and will extend the company’s repayment to 2030.

Gindalbie chairman Keith Jones said the refinancing process was a prudent initiative to extend and smooth Karara Mining's debt maturity profile.

It comes eight months after Gindalbie was forced to write down the value of its Karara investment by nearly $600 million.

The write down, falling iron ore price, and other problems at the operation led the company to undertake a strategic review in January.

It went so far to offer its Badja Station as a potential dump for radioactive scientific and medical waste.

Karara Mining is 47.8 per cent owned by Gindalbie, while the remaining 52.2 per cent is controlled by Chinese steelmaker Anshan Iron and Steel Group Corporation.

Karara’s first ore shipment was in March 2011, followed by magnetite concentrate production in November 2012.

Gindalbie was 2.6 cents per share at the time of writing.

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