www.indiaresources.com.au
India Resources Limited (ASX: IRL) operates the Surda Copper Mine in India. IRL has developed a close commercial alliance with Hindustan Copper Limited (HCL, a Government of India enterprise). These alliances with HCL are a first for an overseas group. Hindustan Copper is the sole integrated producer of primary copper in India and is listed on the Mumbai, Delhi, Calcutta and Madras exchanges.
India Resources begins groundwork for growth, settles loan
Copper and coal company India Resources (ASX: IRL) has settled the first tranche of an agreement between with Alexandra Resources Pty Ltd and Territory Resources Limited.
Alexandra has purchased Territory’s shareholding in the IRL (19,019,000 shares) and will acquire the loan of $1.5 million due by IRL to Territory in four tranches, with transfer of the first tranche of $750,000 having been completed.
The company has allotted and issued 14,307,516 ordinary fully paid shares to Alexandra in satisfaction of $375,000 of the outstanding debt.
In addition, three unsecured convertible notes each with a face value of $125,000 have been issued to Alexandra in satisfaction of a further $375,000 of the loan balance.
Alexandra has advised that it considers its shareholding in the Company to be a long term strategic investment.
Managing director, Arvind Misra said today the conversion of the loan to equity and convertible equity forms part of the company’s strategy to reduce debt levels and strengthen the Company’s balance sheet.
"Coupled with the ongoing debt reduction and improved profitability at the Surda operations, the Company is laying the platform for continued growth in 2010 on the back of the booming mining sector in India," he said.
Payment for the balance of the Territory loan will occur in three further tranches of $250,000 each over the next three months.
Recently, India Resources successfully turned around the Surda Copper Mine in India, through achieving on-going cost efficiencies and increases in copper production.
The mine achieved an unaudited operating profit result, inclusive of amortisation and depreciation charges, in recent months.
For the month of January, the Surda Mine produced over 305 tonnes of metal-in-concentrate for delivery to Hindustan Copper Limited’s (HCL’s) nearby smelter.
Cash flows from the Surda Mine will contribute to the funding for the development of the Bankura coal project.
