Australia’s Moly mines secures $700-million Chinese investment
21 Oct 2009
In another instance of growing Chinese investments in the world's resources sector, Australia's Moly Mines reached an agreement yesterday with Hanlong Mining Investment Pty Ltd, a subsidiary of privately owned Chinese company, Sichuan Hanlong Group Co Ltd (Hanlong) for a $700-million equity and debt funding for its Spinifex Ridge project in Western Australia.
Under the terms, Hanlong will buy 207.1 million Moly Mines shares for $140 million and provide a 10-year loan of $60 million. In addition, Hanlong will commit to procuring debt financing of $500 million by 30 June 2010 for the 10 million tonnes per annum molybdenum/copper project.
The proposed funding is in addition to the recently announced Institutional Placement and Share Purchase Plan (SPP), which will enable Moly Mines to repay all outstanding amounts on the Trust Company of the West (TCW) Interim Finance Facility by February 2010.
Hanlong will receive 35.5 million unlisted 3 year options exercisable at C$1.00 per share.
Perth-based Moly Mines is a resources company focusing on the development of base metals projects including world class Spinifex Ridge molybdenum project which is in advanced development stage. Other exploration stage projects include Glen Eden and Mt Tennyson. The company's shares are listed on the Australian and Toronto Stock Exchanges.
Moly Mines CEO Derek Fisher said, ''This Agreement represents a wonderful opportunity for Moly Mines to clear the company's existing debt and build the Spinifex Ridge molybdenum / copper project significantly ahead of the point at which funding from the traditional debt and equity markets becomes available.''
