Investment adviser Appian Capital Advisory has offered to provide short-term and flexible financing solutions across the capital structure of mining companies with near-term balance sheet pressures and liquidity concerns as a result of the Covid-19 outbreak.
“We are conscious that the broader mining industry is already under pressure. There has been a demand shock and prices have fallen. Restrictions on the movement of people have forced companies to change working patterns. Supply disruption could increase further if the virus spreads to key commodity producing regions in Latin America and Africa.
“It is precisely in times like this that long-term capital and through-the-cycle thinking are required to support high-quality businesses and management teams,” Appian says.
To address the challenges presented by Covid-19, Appian has expanded its focus and is ready to provide short-term, flexible financing solutions across the capital structure, including credit facilities, to support mining companies with near-term balance sheet pressures and liquidity concerns – in addition to considering its usual direct equity investments.
The long-term nature of the Appian Funds’ capital base and the flexibility of Appian’s investment mandate allow it to support partners within the range of $50-million to $300-million of financial support, including equity, bridge loans and other forms of credit.
Appian has significant investment experience in both development assets and operating mines across a range of commodities and jurisdictions, with a current portfolio including base, precious and specialty metals in Latin America, North America, Australia and Africa.
“We remain constructive on the medium- and long-term outlook of the sector and look forward to continuing our engagement with industry participants world-wide,” Appian notes.
The advisory adds that the spread of coronavirus has had a profound impact on people’s lives, economies, commodity prices and financial markets worldwide.
Although the full impact is not yet clear, Appian is monitoring the situation closely.
“Our first priority is the safety of our people. Our operations around the globe have implemented measures to protect employees, limit the spread of the virus and assist local communities. We will keep these arrangements under review as the situation evolves and will continue to assess how we can play our part in the response.”