Wolf to raise $80m in bank finance

Perth-based specialty minerals company Wolf Minerals will raise $80.1 million through debt fund facilities to finance construction of its Hemerdon tungsten and tin project in Southwest England.

Wolf announced today it had appointed UniCredit Bank, ING Bank and Caterpillar Financial SARL to provide the senior debt facilities.

The three lenders were appointed following a competitive process facilitated by Optimum Capital, which incorporated a technical due diligence review undertaken by Micon International and an independent marketing study by Roskill Consulting.

The Hemerdon project was recently valued at $115.4 million in a definitive feasibility study.

Wolf also announced it was in discussions with potential off-take partners to provide subordinated debt for the project.

Wolf Minerals managing director Humphrey Hale said the appointment of the three lenders was a major milestone for the project.

“All three are leading providers of finance to the mining sector and their appointment provides further strong validation of the Hemerdon project’s potential to become a major specialty minerals mining operation,” he said.

The lenders are expected to gain approval for the facilities in February next year.

The appointments are in contrast to Wesfarmers CEO Richard Goyder’s warning on the impact of the Europe crisis on bank finance.

Mr Goyder said he was worried European banks were taking liquidity out of the market, which would be a “real issue” to small businesses, according to The Australian.

His assessment was reiterated by National Australia Bank Ltd's head of business Joseph Healy.

"The issue has the potential to be quite serious next year depending on the extent of the European banks' withdrawal and the length of time that term funding markets remain effectively closed," Mr Healy said.

Wolf shares were up 3 cents to 27 cents at 10.20am WST today.