Mozambique : Oman’s fund to enter Moma mine through 100 mln $ investment in Kenmare

Kenmare Resources plc, operating Moma titanium Mine in Mozambique, reached a cornerstone subscription agreement for a 100 million US$ equity investment with subsidiary of Sultanate of Oman’ State General Reserve Fund and said confident for debt restructuring and working capital.

On June 20, the London and Irish Stock Exchange listed company said the State General Reserve Fund of the Sultanate of Oman (SGRF) has, through its subsidiary African Acquisition Sarl, signed a cornerstone subscription agreement for a US$100 million equity investment.

Kenmare plans, in a capital and debt restructuring, to raise a minimum of 275 million US$ of new equity and a maximum of approximately 368 million US$.

The maximum will help the company reduce the total outstanding Group debt to nil, the company reported. 

But the minimum will provide funds to allocate 75 million US$ for working capital needs and expenses of the transaction while 200 million US$ will serve to repay approximately 269 million US$ project debt and accrued interest.

The cornerstone placing represents approximately 229% of Kenmare’s existing issued ordinary share capital.

In case the minimum of 275 million US$ is raised, SGRF will hold 29.2% on completion of the capital restructuring, but 24.3% in case the maximum of approximately 368 million US$ is raised.

Kenmare expects to complete the capital restructuring on or around the beginning of August, 2016, including holding an extraordinary general meeting at which resolutions necessary for implementation of the Capital Restructuring will be proposed.

Moma Titanium Minerals Mine is located on the north east coast of Mozambique, with deposits that contain heavy minerals which include the titanium minerals ilmenite and rutile, as well as the zirconium silicate mineral, zircon.