REG - Horizonte Minerals - INTERIM US$20M FUNDING PACKAGE SIGNED

Horizonte MineralsAnnouncement

27/12/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231227:nRSa8464Xa&default-theme=true

RNS Number : 8464X  Horizonte Minerals PLC  27 December 2023

NEWS
RELEASE

27 December 2023

 

HORIZONTE SIGNS INTERIM US$20 MILLION FUNDING PACKAGE

 

 

HIGHLIGHTS:

 

·    Horizonte agrees a US$20 million interim funding package provided by
Orion, Glencore and La Mancha

·    The funding package is expected to provide liquidity while a full
funding solution is progressed

·    Agreement with existing Senior Lenders to defer interest payments due
31 December 2023

·    The Company continues to review the outstanding Project capital
expenditure and schedule re-estimate, necessary to implement a full funding
solution

 

 

Horizonte Minerals Plc (AIM/TSX: HZM) ("Horizonte" or the "Company") the
nickel development company, announces that it has agreed a US$20 million
interim funding package (the "Funding Package") which comprises a US$15
million Senior Secured Loan Facility (the "Facility"), and the release of US$5
million by OMF Fund III (Cr) Ltd. previously secured at Vermelho, that will
allow for critical construction streams to advance at its flagship Araguaia
Nickel Project ("Araguaia" or "the Project") and for general working capital
purposes.

 

Interim CEO Karim Nasr commented, "We are pleased to see the continued support
from our cornerstone shareholders through this US$20 million funding package.
This funding package is a demonstration from the Company's largest
shareholders on their commitment towards finding a solution to complete the
Araguaia Nickel Project construction. We are actively engaging with our
cornerstone shareholders and senior lenders with the goal of unlocking a
funding solution in Q2 2024. We wish to thank our cornerstones, local
stakeholders and employees for their continued commitment and support."

 

The Facility has been provided by OMF Fund III (F) Ltd. ("Orion Mine
Finance"), La Mancha Investments S.à r.l. ("La Mancha") and Glencore
International AG ("Glencore") (together the "New Money Lenders"), who have
each committed US$5 million to the Facility. The New Money Lenders will rank
pari passu with the Senior Lenders and will benefit from the same security
package. The Facility will have a maturity date falling 102 months from 7
December 2022 and will bear interest at 15.00% per annum.

 

Furthermore, the existing Senior Lenders have agreed to waivers that include
deferral of interest due at 31(st) December 2023 to the end of February 2024
in addition to any breaches or Events of Default under the Senior Debt
Facilities.

 

The Funding Package constitutes a related party transaction under Rule 13 of
the AIM Rules for Companies. As such, the Company's independent directors
(excluding those connected to La Mancha and their nominees) consider, having
consulted with its nominated adviser Peel Hunt LLP, that the terms of the
Funding Package are fair and reasonable insofar as its shareholders are
concerned.

 

Further to the above, OMF Fund III (Cr) Ltd. has demonstrated its further
support to the Project through the release of an additional US$5 million
currently secured at Vermelho, Horizonte's second 100% owned project in
Brazil. Following the closing of the funding package, US$11 million will
remain segregated for the development of Vermelho, where on-going studies
continue to advance.

 

The Funding Package provides the Company with liquidity to advance the
required re-estimation work at Araguaia, necessary to implement a full funding
solution. It will also allow two critical workstreams to be completed, the
Water Storage Reservoir and the 230kV powerline, while maintaining a strong
focus on safety.

 

As previously announced, the Company's cornerstone shareholders and senior
lenders are continuing to undertake their respective due diligence as part of
a full funding solution, which includes working with the Company and
consultants who are undertaking a review of the outstanding Project capital
expenditure and schedule. It is expected that this due diligence process and
review will be finalised in Q1 2024, with a full funding solution targeted for
Q2 2024.

 

While the Funding Package will allow near term work at Araguaia to progress,
completion of construction activities at Araguaia will be subject to
successful completion of a full financing solution in 2024. There can be no
certainty at this stage that the full financing solution will be achieved.

 

 

 

Figure 1 - An overview of the Araguaia processing site as at the beginning of
December 2023.

 

 

 

 

Figure 2 - A view from above the Homogenisation building looking towards the
primary and secondary crushers, the ROM pad and stockpiles.

 

 

 

 

Figure 3 - A view of the steel erection of the Electrostatic Precipitator, the
Rotary Kiln, the Electric Arc Furnace and the Refinery.

 

 

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014, as retained in the UK pursuant to the European Union
(Withdrawal) Act 2018.

 

 

For further information, visit www.horizonteminerals.com
(http://www.horizonteminerals.com) or contact:

 

 Horizonte Minerals plc                                                     info@horizonteminerals.com (mailto:info@horizonteminerals.com)

 Patrick Chambers (Head of IR)                                              +44 (0) 203 356 2901

 Peel Hunt LLP (Nominated Adviser & Joint Broker)                           +44 (0)20 7418 8900

 Ross Allister

 Richard Crichton

 David McKeown

 Bhavesh Patel

 BMO (Joint Broker)                                                         +44 (0) 20 7236 1010

 Thomas Rider

 Pascal Lussier Duquette

 Andrew Cameron

 Barclays (Joint Broker)                                                    +44 (0)20 7623 2323

 Philip Lindop

 Richard Bassingthwaighte

 Tavistock (Financial PR)                                                   +44 (0) 20 7920 3150

 Jos Simson

 Cath Drummond

 

 

ABOUT HORIZONTE MINERALS

Horizonte Minerals Plc (AIM/TSX: HZM) is developing two 100%-owned, Tier 1
projects in Pará state, Brazil - the Araguaia Nickel Project and the Vermelho
Nickel-Cobalt Project. Both projects are high-grade, low-cost, with low carbon
emission intensities and are scalable. Araguaia is under construction and when
fully ramped up with both Line 1 and Line 2, is forecast to produce 29,000
tonnes of nickel per year. Vermelho is at feasibility study stage. Horizonte's
combined production profile of over 60,000 tonnes of nickel per year positions
the Company as a globally significant nickel producer. Horizonte's top three
shareholders are La Mancha Investments S.à r.l., Glencore Plc and Orion Mine
Finance.

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

Except for statements of historical fact relating to the Company, certain
information contained in this press release constitutes "forward-looking
information" under Canadian securities legislation. Forward-looking
information includes, but is not limited to, the ability of the Company to
complete any planned acquisition of equipment, statements with respect to the
potential of the Company's current or future property mineral projects; the
ability of the Company to complete a positive feasibility study regarding the
second RKEF line at Araguaia on time, or at all, the ability of the Company to
complete a positive feasibility study regarding the Vermelho Project on time,
or at all, the success of exploration and mining activities; cost and timing
of future exploration, production and development; the costs and timing for
delivery of the equipment to be purchased, the estimation of mineral resources
and reserves and the ability of the Company to achieve its goals in respect of
growing its mineral resources; the realization of mineral resource and reserve
estimates and achieving production in accordance with the Company's potential
production profile or at all. Generally, forward-looking information can be
identified by the use of forward-looking terminology such as "plans",
"expects" or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not anticipate",
or "believes", or variations of such words and phrases or statements that
certain actions, events or results "may", "could", "would", "might" or "will
be taken", "occur" or "be achieved". Forward-looking information is based on
the reasonable assumptions, estimates, analysis and opinions of management
made in light of its experience and its perception of trends, current
conditions and expected developments, as well as other factors that management
believes to be relevant and reasonable in the circumstances at the date that
such statements are made, and are inherently subject to known and unknown
risks, uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of the Company to be materially
different from those expressed or implied by such forward-looking information,
including but not limited to risks related to: the inability of the Company to
complete any planned acquisition of equipment on time or at all, the ability
of the Company to complete a positive feasibility study regarding the
implementation of a second RKEF line at Araguaia on the timeline contemplated
or at all, the ability of the Company to complete a positive feasibility study
regarding the Vermelho Project on the timeline contemplated or at all,
exploration and mining risks, competition from competitors with greater
capital; the Company's lack of experience with respect to development-stage
mining operations; fluctuations in metal prices; uninsured risks;
environmental and other regulatory requirements; exploration, mining and other
licences; the Company's future payment obligations; potential disputes with
respect to the Company's title to, and the area of, its mining concessions;
the Company's dependence on its ability to obtain sufficient financing in the
future; the Company's dependence on its relationships with third parties; the
Company's joint ventures; the potential of currency fluctuations and political
or economic instability in countries in which the Company operates; currency
exchange fluctuations; the Company's ability to manage its growth effectively;
the trading market for the ordinary shares of the Company; uncertainty with
respect to the Company's plans to continue to develop its operations and new
projects; the Company's dependence on key personnel; possible conflicts of
interest of directors and officers of the Company, and various risks
associated with the legal and regulatory framework within which the Company
operates, together with the risks identified and disclosed in the Company's
disclosure record available on the Company's profile on SEDAR at
www.sedar.com, including without limitation, the annual information form of
the Company for the year ended December 31, 2022, and the Araguaia and
Vermelho Technical Reports available on the Company's website
https://horizonteminerals.com/. Although management of the Company has
attempted to identify important factors that could cause actual results to
differ materially from those contained in forward-looking information, there
may be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate, as actual results and future events could differ materially from
those anticipated in such statements.

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  MSCZQLFLXLLXFBX