Phoenix Copper Ltd (AIM:PXC, OTCQX:PXCLF) has seen a US$80 million corporate copper bond issue fully subscribed by one investor.
NIU Invest, a European private equity firm, subscribed for the whole tranche, subject to certain conditions being met.
The bonds will be drawn down in stages as the construction of the Empire Open-Pit Mine in Idaho, US, progresses.
Some US$5 million will be drawn down on 31 May 2024; US$5 million on 30 June 2024; US$20 million on 31 August 2024; and US$50 million in two tranches during the first half of 2025.
The bonds are not convertible but have an arrangement fee of 33.88 million shares plus no-cost warrants for a further 22.59 million.
On a fully diluted basis, NIU Invest will have the right to accumulate up to a 25% strategic investment in the company over five years.
Marcus Edwards-Jones, executive chairman, added that everything is falling into place for Phoenix.
"As I write copper is trading close to the symbolic $10,000 per tonne, having rallied strongly in recent weeks. Despite several delays and disappointments, we are hopeful that our stars are finally aligning.
"Uncertainties over the Chinese and US economies meant that it took longer for the drivers of electrification and supply issues to reassert their influences on the copper price. It now looks as if the penny has finally dropped
“As the BHP Group bid for Anglo American PLC (LSE:AAL) shows, it is more expedient to expand your copper reserves by buying somebody else's, rather than developing your own.
“As in politics, investment decisions, however beneficial in the long term, are seldom taken by people who may not be around to see the rewards, yet suffer if there are any delays in execution.
"This all points to a 'higher for longer' scenario for the copper price which the board anticipates will be responsible for some 70% of the company's predicted revenues from the Empire open pit mine in Idaho, USA, a State with a proven and ongoing reputation for permitting mining projects.”
Phoenix also reported that investment in Empire rose to US$38 million in 2023, while the group reported an annual loss of US$1.57 million.