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£1.5m difference but point the same
No need to throw toys out of pram imo.
Saloro might achieve, what, 10-12% in the market? They might still get it, but even if they don't, what's the difference, about £0.5m max? Perfectly manageable in this huge project on the cusp of production. And to be fair to Oaktree, they probably don't want more exposure, and note they are not standing in the way of another junior lender who might want to join the party. And, of course, they've said yes to a loan themselves, albeit on onerous terms.
Knowing this share, some random sh*t will pop up and cause another headache before too long, but right now, there's no other major obstacles ahead. Nesting season's over too, so no more of those storks hopefully, either.
Some businesses are struggling to secure finance at the moment, so it's good that we have this on standby ( as that's what is seems to indicate ). Hopefully the draw-downs won't last too long once we get into full production, possible 40% uplift with seven day working week and tungsten price heading in right direction. No indication though on plans for other Spanish assets ( ie copper and gold ). Was there any mention of this at the AGM you guys who were able to attend?
18% is eye-watering, and 3% on undrawn amounts is taking the p*ss, but I agree the good news is that a loan's been achieved. It's also a backstop, so better terms (also debt funding) from a third party lender is a possibility. It's perhaps lower risk at this later stage in the project, from a lender's perspective. Imo we've been beaten up by Oaktree here, but whilst we might lose this funding battle, we're definitely winning the war.
As expected, the need for increased liquidity has taken the form of a loan rather than equity as the terms of the existing JV would or, at least, should have set out a path should such a credit crunch arise.
Whilst I guess PI's should be grateful there is no dilution, Oaktree have clearly not missed the opportunity to be their usual rapacious selves and shaft us on the Interest (and possibly other hidden) charges.
We were over a barrel and in the circumstances had very little negotiating strength here.
I may be wrong, but I think this is the first time any Interest details on the original loan has been made public.