MZI secures $US61m debt funding

Mineral sands miner MZI Resources has announced a new $US61 million ($80 million) debt funding package with major shareholder Resource Capital Funds to continue development at its Keysbrook operation near Serpentine and facilitate debt restructuring.

Under the agreement, RCF will increase an existing capital facility by $US10 million to meet short-term requirements.

All amounts outstanding under the facility will then be repaid from funds advanced under a new three-year secured $US61 million term loan.

The loan has a 15 per cent interest rate with a 3 per cent establishment fee.

The money under this loan will be provided in two tranches, of $US53.5 million and $US7.5 million.

Chief executive Martin Purvis said the funding was a major step forward for the company

“The new RCF funding package represents a major vote of confidence in the future potential of the Keysbrook operation and the mineral sands business as a whole,” he said

“Importantly, the package will not only provide us with a stable funding platform while we complete the 5.25 million tonnes per annum plan, it will also simplify our working capital funding arrangements and extend their maturity to mid-2021.

“Overall the funding package aligns well with our schedule to refinance our senior project facilities in the second half of 2018 and better reflects Keysbrook’s long projected mine life.”

Shares in MZI finished flat at 11 cent each.