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VSA Capital Market Movers - NQ Minerals

NQ Minerals (OTCMKTS:NQMI) has announced it has reached an agreement with ING Bank N.V. to provide the company with a US$41m refinancing facility to assist with restructuring of the corporate debt that was originally taken on to start mining operations at NQMI's Hellyer tailings re-treatment mine in Tasmania, Australia.

Capital Limited - VSA Capital Market Movers - NQ Minerals

VSA Morning Miner, 16/07/20

NQ Minerals (OTCMKTS:NQMI)

NQ Minerals (OTCMKTS:NQMI) has announced it has reached an agreement with ING Bank N.V. to provide the company with a US$41m refinancing facility to assist with restructuring of the corporate debt that was originally taken on to start mining operations at NQMI's Hellyer tailings re-treatment mine in Tasmania, Australia.

The drawdown of the new facility which remains subject to completion of final documentation has a maturity of 6 years whilst carrying an interest rate of 6.5% plus US LIBOR (1 month).   The facility also includes an accordion option to increase the amount up to US$55 million but remains subject to approval by the credit committee.

This new financing arrangement will allow NQMI to repay the project’s earlier debt and reduce the company’s loan repayments by US$2.5mpa as a result of a more stabilised operating environment in addition to the successful final commissioning phase at Hellyer which has a targeted throughput rate of 1.2 million tonnes per year.  The agreement was facilitated by NQMI's concentrates off taker, Traxys Sarl who assisted with accessing the loan facility.  In return Traxys gained an extension of its off take agreement from 2024 through to the end of life-of-mine and therefore provides NQMI with greater certainly regarding payments for the mine’s production.

We reiterate our Buy recommendation and 21p target price.   

Oliver O'Donnell, CFA, Head of Research & Natural Resources Analyst | T: +44 (0)20 3617 5180 | E: oodonnell@vsacapital.com
Paul Renken, Senior Geologist | T: +44 (0)20 3005 5011 | E: prenken@vsacapital.com

VSA Capital Research | T: +44 (0)20 3005 5000 | E: research@vsacapital.com

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