Kore Potash has announced its intention to raise approximately US$11 million, before expenses, by way of an unconditional placing, a conditional placing and direct subscriptions of new ordinary shares in the Company at a price of 1.1 pence with certain eligible existing shareholders and new institutional and other investors.
Shore Capital Stockbrokers are acting as sole UK bookrunner in connection with the Proposed Fundraise.
On 6 April 2021, the Company announced that it had signed a non-binding MoU with Summit Africa which outlines a roadmap to optimise, fully finance and construct the Kola Project via a mix of debt and royalty financing.
Summit and its technical partners SEPCO Electric Power Construction Corporation and China ENFI Engineering Corporation, which has been subcontracted by SEPCO, will work with Kore Potash to undertake an optimisation study to reduce Kola’s capital cost with a target of less than US$1.65 billion.
Summit will work with potential financing partner BRP Global to, subject to completion of their due diligence and achieving the Target Capex through the optimisation study, present a financing proposal on behalf of the Summit Consortium based on debt and royalty funding for 100% of the Kola construction capital costs.
Under the proposed financing structure, the Company would not be required to contribute to the capital needed to build the project and would retain a 90% equity interest in Kola.
The MoU was signed in the Minister of Mines offices in Brazzaville with the Minister and his key staff present. Under the proposed financing arrangements, the RoC Government would retain their 10% shareholding in the Kola Project.
The Company will contribute approximately US$900,000 to the optimisation study costs. SEPCO will cover the remaining 50% of the estimated costs of the study. Kola remains one of the most attractive potash projects in the world, with market low-operating costs.