Peninsula Energy Ltd (ASX:PEN, OTCQB:PENMF) has secured a debt facility of up to US$15 million with Davidson Kempner Capital Management LP, a global investment firm with over US$35 billion in assets under management. The financing will fund critical development and commissioning activities at the company’s Lance Project in Wyoming and support a planned equity capital raising.
The package comprises a US$10 million cash advance, expected to be drawn imminently, and a US$5 million convertible facility contingent on shareholder approval and completion of the equity raise. Up to US$10 million of the cash advance may be refinanced under a new convertible arrangement, also subject to shareholder approval. The financing is aimed at ensuring Peninsula remains on track to produce dry yellowcake by the end of August 2025.
“We are very pleased to be able to secure this debt financing with a highly regarded leading global investment management firm,” Peninsula Energy’s managing director and CEO, George Bauk said. “As the company works through resolving key matters like the offtake contract book, it is clear that we needed to secure short-term financing to ensure we can continue to methodically and efficiently deliver on our development and commissioning program at Lance and further strengthen our cash position and balance sheet together with and whilst progressing an equity capital raising. The debt financing enables the company to maintain momentum with the program which would have been challenging from a timing perspective if solely relying on the equity raising to provide funding, A low cash balance may also have impacted on the Company’s ability to maximise its chances of a successful raising, and we feel very positive about that process now the debt financing is in place.”
Immediate drawdown to support commissioning
The company plans to draw down US$10 million from the cash advance component of the facility in the coming days, allowing it to maintain momentum with commissioning work at Lance. Key activities include water commissioning, pre-operational inspection and approval under the Wyoming Uranium Recovery Program (URP), and hot commissioning—all essential for initiating yellowcake production.
“Through this debt financing we will promptly draw down US$10 million, which importantly allows us to maintain our trajectory towards starting operations in the coming months and then resuming trading on the ASX. It is extremely positive that a global investment management firm is committed to the Company with support for the upcoming equity raising,” Bauk said.
The URP approval process is a standard requirement to confirm readiness and personnel training prior to the start of operations.
Convertible facility and equity raising plans
A US$5 million convertible loan will become available after securing shareholder approval and completing a minimum US$30 million equity raise. In parallel, Davidson Kempner has committed to subscribe for up to US$3 million in Peninsula shares during the upcoming raise—offsetting this amount against the loan balance.
Peninsula will also seek shareholder approval to refinance up to US$10 million of the original cash advance as a convertible facility. A shareholder vote will be taken on the above before the end of August 2025.
Facility terms and security structure
The two-year senior secured debt facility includes bullet repayment, fixed interest, and make-whole conditions for early repayment. It is secured over all assets of the borrower and guarantors, excluding certain exceptions.
Detachable warrants representing 2.5% of Peninsula’s fully diluted share capital will be issued to Davidson Kempner, subject to shareholder approval. These are exercisable at 150% of the equity raise price or a minimum of A$0.45 per share if the raise is not completed by 30 September 2025.
“I would like to thank Davidson Kempner for their support through what is a critically important development for our Company. I acknowledge the support of our shareholders. I understand the last few months have been frustrating, however they have also been transformative for Peninsula, where we have reset necessary operational and financial foundations to allow us to ensure when we restart production, we can execute on our targets and establish Lance as key supplier of yellowcake to the growing United States and global market.”
Outlook and next steps
Peninsula remains focused on finalising the reset of its sales contract book and preparing for a relisting of its shares on the ASX. The company emphasised that this announcement is separate from the pending update referred to in its April trading halt and that shares will remain in suspension until finalisation of the equity raise and associated matters.
With commissioning progressing and financing secured, Peninsula is positioning itself to become a significant US-based supplier of uranium through its Lance Project.