Metal Tiger PLC (AIM:MTR, OTC:MRTTF, FRA:EBRA, ASX:MTR) has completed its entitlement rights investment in Sandfire Resources.
Metal Tiger subscribed for 3.3mln Sandfire shares at a total cost of A$17.8mln.
READ Metal Tiger to invest A$17.8mln ln Sandfire Resources placing
Metal Tiger partially financed the purchase of new Sandfire shares by selling 1.1mln Sandfire shares it already owned at an average price of A$5.22 per Sandfire share.
It also entered into a 12-month, A$9mln margin lending facility agreement with a nominee of SC Lowy Primary Investments Ltd, which is secured against 4.7mln Sandfire shares held under a tripartite sponsorship deed with an Australian broker.
The margin lending facilities carries a 10% interest rate per annum payable every six months.
“The margin lending facility allows Metal Tiger to maintain leverage to any potential upside in Sandfire over an extended period, with what the board considers to be an appropriate level of risk, thanks to strong liquidity rights over collateralised shares,” said Michael McNeilly, the chief executive officer of Metal Tiger.