Tanzanian-focused flake graphite development company Volt Resources Limited (ASX: VRC) advised that it will proceed with the issue of US$40 million in structured debt funding.
As previously advised (see ASX Announcement dated 25 October 2017), Volt has engaged Exotix Capital to undertake a Tanzanian Bond issue to raise the required funding for the development of Stage 1 of the Bunyu project.
Following recent meetings with targeted investment groups in Tanzania, Uganda and Kenya, Exotix has recommended Volt proceed with a formal bond prospectus process and listing of the bonds on the Dar es Salaam Stock Exchange (“DSE”) in Tanzania. Volt and Exotix have sized the debt transaction at US$40 million on the key terms set out below which will allow net project development and working capital funding of ~US$31 million after taking into account a Debt Service Reserve Account (DSRA) and costs of the issue. The facility interest and bond maturity payments can be serviced by projected project cashflows.
Importantly, the US$40m debt sizing allows meaningful participation from Tanzanian and Ugandan Pension Funds combined with other investment groups seeking fixed income investments.
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