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I think that Strabag and DMC could have a huge say/impact on any solution. What do they have to lose by carrying on with the projects till completion, with say only wages being paid by Sirius? Moreover, what do they have to lose if they pack up until finance is sorted? Strabag - 2 more drives have been commissioned - has any of it actually been built? Staff are already earmarked for the project for both companies- do they have something equally as pressing that they could be moved to? Would be a huge leap of faith for both but surely there are incentives (profit share for example?) that could be offered. The absolute realities is that neither company wants any form of slowdown or delay. And as mentioned earlier by brokers, re the TBM"....offers the potential to use the machine's mucking system to transport up to 6m tonnes per year of polyhalite during tunnel fitout, which would accelerate commercial production." Maybe it's time for more creative solutions?
JPM may still provide a RCF supported h.y.bond based fundraising; With the major funding for the more risky deep shafts and long tunnel raised from other sources, the potential bond purchasers could become more confident.
Such a new component-based multiple-source funding structure, when put together, would be much better than the previous ones (i.e., the bank group one and the JPM one).
Great ideas as described by Liberum to divide and conquer the risk associated with different components and to collect funds from different sources/investors:
- (high risk) deep shafts funded by a strategic/industry partner ($500m to reach the first poly);
- (medium risk) tunnel funded by a number of investors for "infrastructure finance";
- (low risk) funding needed for all the rest (non- or less-risky components) funded by h.y.bonds possibly partly guaranteed by IPA (as a cover offered in this way, the risk to tax payers' money will be very low)
With such an arrangement and fixed prices for all the elements, SM may get a better credit rating (BB) and the bonds would be much easier to sell. These really sounds plausible!
https://www.google.co.uk/amp/s/www.proactiveinvestors.co.uk/companies/amp/news/902972