Talvivaara soars on loan agreement with Nyrstar

Shares soared in Finnish nickel and zinc miner Talvivaara as it secured a loan, from Belgian zinc giant Nyrstar, that looks to have solved its 'critical' funding issues. Nyrstar, with which Talvivaara has a zinc streaming agreement, has agreed to loan Talvivaara up to a maximum of €20m in several tranches calculated against future deliveries of zinc.On February 24th Talvivaara said it had €5.9m cash but that in the absence of further funding its liquidity situation was "critical". Nyrstar is Talvivaara's main creditor, having paid €232m in advance for zinc.It said the new inter-company loan addressed its current financing needs and reduced the company's overall funding gap before it reached sustainable positive cash flow, and that it was also looking to identify potential investors to participate in a "long-term, overall financial solution" for the group.If Talvivaara finds such a solution, Nyrstar has agreed to offer a "streaming holiday" that would exempt the Finnish miner from delivering up to 80,000 tonnes from its streaming agreement, with Nyrstar still able purchase zinc ore from Talvivaara at market prices and also ending the loan financing.Shares in Talvivaara were up 41.7% to 5.23p at 10:45 on Tuesday, having fallen from more than 20p in the previous 12 months. OH