The Dublin-based firm – which owns and operates the Moma titanium mine in Mozambique – announced yesterday its chief lenders have approved its debt restructuring plan, which will, at the very least, see its debt mountain shrink from $330m to no more than $100m.
The plan sees Kenmare raising between $275m and $368m in total.
The sovereign wealth fund of Oman will invest $100m for an equity stake of between 24.3% and 29.2%. The rest of the funds will be raised from new and existing shareholders.
In all, at least $215m will come from Oman and three existing major shareholders, while Kenmare’s lenders are underwriting a further $60m in a debt-for-equity swap.
An open offer to investors could push the overall raise to $368m, which would wipe out the entire debt.
Initial plans will see $200m used to pay off debt and $75m will go to meeting working capital needs.
“Early indications of investment from three of the main shareholders of Kenmare, in combination with lender underwriting position the company well to achieve the minimum target of $275m,” said managing director Michael Carvill.
Mr. Carvill added that the debt deal, a reacapitalised balance sheet, a new strategic investor and an improvement in mineral prices puts Kenmare in a strong position “in an industry with expectations of a growing supply deficiency.”