REG - Andrada Mining Ltd - Funding Agreement

Andrada MiningAnnouncement

19/03/2024 07:45

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240319:nRSS3922Ha&default-theme=true

RNS Number : 3922H  Andrada Mining Limited  19 March 2024

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (MAR) as in force in the United Kingdom pursuant to the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via Regulatory Information Service (RIS), this inside information will be in the public domain
 

19 March
2024
 

Andrada Mining Limited

("Andrada" or the "Company")

Funding Agreement

Andrada Mining Limited (AIM: ATM, OTCQB: ATMTF), the African technology metals
mining company with a portfolio of mining and exploration assets in Namibia is
pleased to announce that its subsidiary Uis Tin Mining Company (Pty) Ltd
("UTMC"), has today entered a conditional, credit-approved NAD 175 million
(approximately GBP7.3m) funding agreement with Bank Windhoek Limited ("BWL").
If completed, these facilities will replace UTMC's current banking facilities
of NAD111.3million (see announcement dated 26 November 2021) and BWL will also
provide all main transactional banking services to UTMC in Namibia.

Highlights

§ Headline terms of a NAD 175million (approximately GBP 7.3million) senior
secured long-term loan and associated short term and working capital
facilities (together the "Lending Facilities") have been agreed with BWL.

§ The intention is that the Lending Facilities will replace UTMC's current
banking facilities.

§ The proceeds from the Facilities will be primarily allocated to working
capital, strategic growth initiatives, and the retirement of existing
facilities. Details on the use of funds are set out below.

Anthony Viljoen, Chief Executive Officer, commented:

"We are excited to partner with a respected Namibian owned financial
institution like Bank of Windhoek. This comprehensive agreement aligns
perfectly with Andrada's current and future funding needs. The increased cash
flow should empower us to execute key operational decisions. Notably, the
improved working capital facility will better support our production increases
year on year. We look forward to executing final documentation and entering
into a collaborative relationship as we achieve our ambitious growth plans."

Rationale for the Proposed New Funding

As set out above, the Directors consider the proposed terms from BWL offer
more favourable terms than current facilities and consider that the lower
monthly payment and longer repayment term will unlock greater cash for the
Company. Furthermore, BWL has indicated its interest in funding the
construction of a 5MW solar plant at Uis. Although, this is still at an early
stage, the directors consider this support for the Company's wider objectives
as indicative of a successful, collaborative future relationship.

Summary of the Terms

The Company has agreed a conditional term sheet for a NAD 100 million
(approximately GBP 4.2 million) Term Loan with BWL and the headline terms
include the following:

§ Loan term of 6 years.

§ Ranked as senior secured debt, pari passu with other senior secured debt
holders.

§ Interest accrues at Namibian Prime lending rate ("Prime Rate") currently
11.50%, plus 1% (a rate of 12.5% per annum). However, a mechanism is in place
to mitigate the impact of the Prime Rate decreases on the facility's interest
rate. This ensures the facility rate remains materially unchanged.

§ It is intended that there will be no capital repayments for the initial 12
months from the date of drawdown.

In addition, the intention is that BWL will refinance the Company's working
capital facilities totalling NAD 50 million (approximately GBP 2.1 million).
These facilities, which are for 12 months from the date of drawdown, will
incur the Prime rate minus 0.5%, resulting in a total rate of 11%. However, a
mechanism is in place to mitigate the impact of the Prime Rate decreases on
the facility's interest rate. This ensures the facility rate remains
materially unchanged. It is intended that these working capital facilities
will be ranked as senior secured debt pari passu with other senior secured
debt holders.

Finally, as part of the Lending Facilities, the Company has also agreed
headline terms for short-term loan facilities of NAD 15 million (approximately
GBP 0.63 million) for use as cashflow against future VAT payments ("Short Term
Loan"). It is intended that the Short-Term Loan will be provided for 12 months
and will incur the Prime rate. Any drawdowns under the Short-Term Loan will be
repaid to the bank upon receipt of refunds from Namibia Revenue Agency

In addition to the Lending Facilities, the intention is that BWL will provide
AfriTin Mining (Namibia) Pty Limited with a NAD 10 million (approximately GBP
0.42 million) guarantee to Namibia Power Corporation Pty Limited in relation
to a deposit for the right to supply electrical power, which will incur a
small fee payable at six monthly intervals.

Any final agreement on the Lending Facilities is subject to legal opinions,
receipt of relevant licences, approvals, and consents, as well as the
negotiation and execution of all applicable documentation. At this stage there
can be no guarantee the Lending Facilities will be entered into but the
Directors and BWL have every confidence the agreement will be concluded. A
further announcement will be made when the documents are executed, but in any
event an announcement will be made before 19 April 2024 when these credit
terms expire.

________________________________________________________________
CONTACT
 ANDRADA MINING                       +27 (11) 268 6555

Anthony Viljoen, CEO

                                    investorrelations@andradamining.com
 Sakhile Ndlovu, Investor Relations   (mailto:investorrelations@andradamining.com)
 NOMINATED ADVISOR
 WH Ireland Limited                   +44 (0) 207 220 1666

Katy Mitchell
 CORPORATE BROKER & ADVISOR
 H&P Advisory Limited                 +44 (0) 20 7907 8500

Andrew Chubb

 Jay Ashfield

 Matt Hasson
 Berenberg                            +44 (0) 20 3753 3040

Jennifer Lee
 WHI Capital Markets                  +44 (0) 20 7220 1670

Harry Ansell
 FINANCIAL PUBLIC RELATIONS
 Tavistock (United Kingdom)           +44 (0) 207 920 3150

Jos Simson

                                    andrada@tavistock.co.uk
 Catherine Drummond

 Adam Baynes

About Andrada Mining Limited

Andrada Mining Limited, is a London-listed technology metals mining company
with a vision to create a portfolio of globally significant, conflict-free,
production and exploration assets. The Company's flagship asset is the Uis
Mine in Namibia, formerly the world's largest hard-rock open cast tin mine.

 

An exploration drilling programme is currently underway with the aim of
expanding the tin resource over the fourteen additional, historically mined
pegmatites that occur within a 5 km radius of the current processing plant.
The Company has set a mineral resource target of 200 Mt to be delineated
within the next 5 years. The existing mine, together with its substantial
mineral resource potential, allows the Company to consider economies of scale.

 

Andrada mining is managed by a board of directors with deep industry knowledge
and a management team with extensive commercial and technical skills.
Furthermore, the Company is committed to the sustainable development of its
operations and the growth of its business. This is demonstrated by the way the
leadership team places significant emphasis on creating value for the wider
community, investors, and other key stakeholders. Andrada has established an
environmental, social and governance system that has been implemented at all
levels of the Company and aligns with international standards.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCDKLBFZXLFBBV