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PERTH (miningweekly.com) – ASX-listed junior Shaw River Manganese has secured up to A$8-million under two separate loan facilities with Bryve Resources to advance its Otjozondu manganese project, in Namibia.
The A$2-million would be covered under a convertible loan facility with Bryve, while the second would consist of a A$6-million working capital facility.
The draw-down of the facilities would be subject to the satisfaction of a number of conditions precedent, as well as Bryve board approval. Shaw River shareholder approval would also be sought to allow the option for tranche 1 of the facility to be converted to Shaw River shares, at a price of 1c a share.
Meanwhile, Shaw River shareholder Atlas Iron has agreed to sell 9.69% of Shaw River’s issued capital to Bryve at a price of A$0.0035 a share. Subject to Shaw River shareholder approval, Atlas would also grant Bryve a six-month option to acquire its remaining 43.76% shareholding in the company, at an exercise price of A$0.0035 a share.
Shaw River has also entered into documentation to amend the terms of an existing loan facility with Atlas, which would reduce the interest rate payable form 11% a year to 6% a year, and would extend the repayment of the loan facility for a period of five years.
The junior told shareholders that once available, the Bryve funding would provide working capital to enable the company to rapidly progress the Otjozondu project, and to bring it to production as quickly as possible.
“The funding provided by Bryve will support Shaw River to fast-track the development of Otjozondu, which is consistent with the path that the company has been pursuing,” said chairperson Michael Walters.
“We have conducted a thorough process to evaluate funding options available and believe this transaction is the best possible outcome for all Shaw River shareholders.”
Over the past 12 months, Shaw River has successfully consolidated the ownership of the manganese project, and has continued to seek capital alternatives to bring the project into production.
“The project now has a clearly identified operating strategy to realise its full potential and following a thorough review process, in conjunction with the PCF Capital Group, a suitable cornerstone investor has been secured to fund the development of the project,” Walters said.
The project currently has a mineral resource of some 17-million tonnes, grading 22.5% manganese.