1. 3.2k
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    $27 MILLION CASH RECEIVED
    TerraCom Limited (TerraCom or the Company) is pleased to announce the completion of the
    insurance bond resulting in $27 million of the Restricted Cash held on the Balance Sheet being
    released back to TerraCom.
    As previously announced, the Blair Athol rehabilitation insurance bond facility is for $72 million,
    however only requires cash backing of $45 million. This demonstrates that an independent third party
    has assessed the maximum rehabilitation exposure at the Blair Athol Mine site to be no more than
    $45 million.
    The Company also confirms that the convertible notes, as approved by shareholders at the 2019
    Annual General Meeting, were issued to OCP Asia (Singapore) Pte Limited in late December 2019.
    The Company’s Cash at Bank as at 31 December 2019 was approximately $66 million1
    . This equates
    to approximately $0.13 per fully paid ordinary share on issue.

  2. 961
    Posts

    Another Sandunes pick on the high now on its 52 week low.

    Sandunes sure does know how to pick em.

  3. 3.2k
    Posts

    sure do from 20 to 80 .. re buy in the 30s plus divi .. real story real cash profits real management watch SGC xst $$$$$$$$$$$$ see LKE today $$$$$$$$$$$$ while AUL at all time lows ..

  4. 3.2k
    Posts

    1. TER flagged using a different mining contractor which would reduce costs by 20% (should see happening this quarter) - tbh I'm still a bit unsure if they are mining there or not

    2. The biggest problem with BNU is the marketability of its resource. Since it is in Mongolia - the only available market for it is Chinese steel makers who play very hard ball with the price as Russians are not buying Mongolian coal - that is my interpretation of it

    3. So the asset does make a lot of sense for a Chinese buyer who could get a better price for its coal or have a vertically integrated system in place (for supplying their steel mills) - again I'm hypothesizing here.

    4. you could recheck their balance sheet - with the arrival of $27m - the debt is around $165m - ok still substantial but they have hacked off huge chunks of it and you have to essentially back the smart management to be where they are right now. 18 months ago TER had $240m of debt with nothing coming in...

    .5. Since FY 19 report TER has announced reduction of costs to $58 AUD ($39 USD) which places them in the 2nd quartile (cost of production) which is phenomenal achievement - again it is the management acumen. With current BA coal (5600 Kcal - 18% ash I believe ? ) fetching around $56-$58 USD (a guess) and USD/AUD ~1.48 - margins of $27 AUD are getting generated per tonne. Not bad in the really bad marke

    6. Frankly the 1Bt of coal with Fernlee and Springsure is a bit of a distant dream and I'm not banking on it just yet. It does need a lot of work and a lot of capital. I doubt we would see it materialise with TER as a public company. With big banks not financing coal mines the cost of capital is too high

    Yes not without risk but I back Wal King and the CEO - past record is generally a good indicator of future performance. Could be wrong DYOR as always.

  5. 961
    Posts

    Natural gas price lowest since 2009, good luck spruiking coal, ramper.

  6. 3.2k
    Posts

    fixed contract $$$ ..coal has another 50 years good luck with a dud gold down the hole dud

  7. 3.2k
    Posts

    UPDATE ON DEBT REFINANCE
    Following the finalisation of the acquisition of Universal Coal plc in June 2020, TerraCom Limited
    (TerraCom or Company) wishes to advise shareholders that is now moving forward with its debt
    refinance program with expected completion by 30 November 2020.
    Once finalised, the debt refinance ensures that TerraCom can maintain the momentum of its global
    growth initiatives and further strengthen its balance sheet placing the Company in a stronger financial
    position by supporting working capital to fund existing projects and planned acquisitions.

    TerraCom has engaged an experienced team to lead and execute the refinance program with
    Christian Baylis as lead advisor. Christian is a highly regarded Australian-based manager with broad
    experience across global fixed income and derivatives strategies, having worked previously at UBS
    Asset Management and the Reserve Bank of Australia.
    Christian managed in excess of $8 billion Assets Under Management and was the lead Portfolio
    Manager in the UBS Australian Fixed Income team for the UBS Cash Plus Fund, the Insurance and
    ALM book of business and ran a complex suite of overlay strategies for large cross-border liability
    clients. Christian was also a member of the Global Multi Strategy Committee and was appointed as
    the Australian representative for the Global Dynamic Fund, the core global unconstrained Fixed
    Income offering for UBS Asset Management.
    In a positive first step for the refinance program, one of the Company’s current debt providers and
    major shareholder, OCP Asia, has already indicated that it will provide up to A$80 million towards the
    debt refinance.
    Commenting on the engagement, lead advisor Christian Baylis said “I am pleased to be working with
    the TerraCom team on their refinance program. By leveraging from my significant investment client
    portfolio and the current economic environment for traditional financing, I am confident that we will
    be able to achieve a significant reduction in interest charges which will represent real cash cost
    savings for TerraCom shareholders.”
    Commenting on the program, Executive Deputy Chairman, Craig Ransley, said “We look forward to
    working with Christian and his team to finalise the refinance over the next few months. Post refinance,
    the Company will be well placed to focus on progressing the Company’s growth strategy to become
    a global bulk commodities producer.”
    The Company will continue to update shareholders with respect to the progress of the refinance
    program over the next few months.
    This announcement has been approved by the Company’s Disclosure Committee for release

  8. 3.2k
    Posts

    Australia’s great and costly retreat from coalGREG SHERIDAN
    The Coalition’s surrender on coal is a far cry from when Scott Morrison, as treasurer, demonstrated his party’s commitment to our black gold.
    The Coalition’s surrender on coal is a far cry from when Scott Morrison, as treasurer, demonstrated his party’s commitment to our black gold.
    12:00AM SEPTEMBER 24, 2020416 COMMENTS
    The biggest story of the moment, the biggest structural change in our politics, is that the Morrison government has admitted comprehensive and probably permanent defeat on coal. It seems like a different era in history when Scott Morrison as treasurer proudly brandished a lump of coal in parliament to demonstrate his party’s commitment to our black gold.

    Still the largest source of our power, still our second biggest export, coal has been placed in the Coalition’s fantasy technology basket, to be revisited one day in the mythical future when renewables don’t need subsidies, pumped hydro creates more energy than it consumes, China’s carbon market comes into operation, and Australia wins soccer’s World Cup 6-0 against Brazil.

    The new lowest common denominator on coal is we continue to export it but there are no circumstances in which we build a coal-fired power station. This is how conservative governments embrace long-term strategic defeat. They win a thousand tactical victories as they march backwards. The Coalition has lost the coal argument. It came into office in 2013 never dreaming it would abandon coal, but that is what it has done.

    READ NEXT

    IN FLAMES
    Traffic warning after massive blaze
    ELLEN RANSLEY
    Labor and the Greens have won the argument even as they have lost the elections. The conservatives — meaning the Liberals and the Nationals — have accepted defeat. The Coalition has a good chance of retaining government by arguing that it will implement the left’s policies more carefully, cautiously, modestly, competently and with less economic damage than Labor would.

    The abandonment of coal has serious strategic implications for Australia. We will never recover a robust manufacturing industry without cheap energy and we won’t have cheap energy without coal. The day after the government announced its wish list of fantasy technologies of the future — which any Labor government would have been proud to unveil — AGL Energy dumped a plan for a discounted electricity contract for Victoria’s Portland aluminium smelter. The long and the short of it is that unless the government shells out massive subsidies we are likely to lose aluminium and then steel as we continue, suicidally, our march away from any manufacturing capability.

    THEAUSTRALIAN.COM.AU3:38
    'Many are pointing out' government's technology roadmap isn't about coal
    Sky News Political Editor Andrew Clennell says many people in the Coalition are pointing out that Energy Minster Angus Taylor’s roadmap isn't about coal.
    Don’t think that in abandoning coal-fired power we are reflecting a global trend. The only people who think that are those whose globalism em­braces New York and Los Angeles, London and Paris, and almost no other part of the world. This year Germany has opened a new coal-fired power plant. Japan has 20-odd in the works over the next five years.

    READ MORE:Jobs, dividends go as New Hope slumps to loss|Coalition’s 2035 carbon plan unveiled|Gas and coal ’fuels of last century’: Butler|Gas is not the answer to our power costs|Old King Coalition steps on the gas
    Ultra-supercritical coal-fired plants — the so-called high-efficiency, low-emissions plants — create about 30 per cent fewer emissions than old coal and a similar amount more than new gas. Such plants are being built in many parts of the world. It is a crazy woke fantasy to think coal is being phased out. Such thinking reflects a spectacular ignorance of Asia, which is becoming an ever bigger part of the global economy.

    Not the only story about coal but by far the biggest is China. The Asia Society’s Policy Institute in New York has rounded up the figures in an extremely useful paper, China’s Response to Climate Change. Almost every climate commentator in Australia refuses ever to confront the China figures. Let me offer you a few of them.

    This year alone China has approved new coal-fired power plants that can produce 17 gigawatts of energy. That is a huge capacity. And China is accelerating its approval and construction of coal-fired power plants, for that is more than it approved in the previous two years.

    Kevin Rudd, in a recent oped in The Washington Post drawing on the Asia Society paper, pointed out that the new coal-fired power plant capacity being developed in China “is larger than the remaining fleet in the United States”.

    The Asia Society records that China has 1040GW of coal-fired energy capacity, but this will be 1100GW by the end of the year. The China Electricity Council and the China State Grid both suggest raising this to 1300GW by 2030. Coal is declining slowly as a proportion of China’s energy mix but it is continuing, as these figures show, to increase rapidly in absolute terms.

    The report also demonstrates the massive increase in coal, and other fossil fuel use, taking place as part of Beijing’s Belt and Road initiative. Specifically, Chinese finance and support is involved directly in new coal-fired power plants in The Philippines, Vietnam, Indonesia, Bangladesh, Pakistan, Mozambique, Malawi, South Africa, Zimbabwe and Serbia. Beyond China, Indonesia has a huge program of coal-fired power plants being built. Before COVID-19 knocked everything off balance, India was planning to increase its coal-fired electricity generation by almost a quarter over three years.

    COVID-19 will slow all this, but only temporarily. What is clear is that coal is booming in most parts of the world not ruled by The New York Times or the BBC. Our corporate leaders, or many of them, are happy to recite the mantra that coal has no future, partly because they want to avoid social media campaigns against them. In the West coal is moving away from public companies and into private equity hands, or into Asian investments directly. None of the expansion of coal outlined above has been denied finance because some Western banks now find coal politically inconvenient.

    THEAUSTRALIAN.COM.AU5:54
    Government is wrong to build gas power station in an area 'filled with coal'
    The Australian’s Adam Creighton says the government is right to get involved in the energy sector, however it’s gone wrong in choosing to “build a gas power station in an area...
    UN projections are that Africa’s population will increase to 4.5 billion by the end of this century. If any of them want to live above subsistence level they will need cheap energy. Coal is sure to play a big part.

    If you are a friend of the environment, indeed if you want to moderate greenhouse gas emissions, you will want Australian coal to be used everywhere that’s possible because ours is the cleanest coal in the world. It’s just a geological fact. If a coal-fired power station in China or India is using Australian coal it will generate fewer greenhouse gas emissions per unit of energy produced than if it is using Chinese or Indian coal.

    And as the biggest exporter (though by no means biggest producer) of coal, we could make a contribution by doing something clever on the technology of getting ever lower emissions from ultra-supercritical coal-fired energy plants. By not doing this we make ourselves poorer economically and weaker strategically, while our competitors, economic and strategic, become richer and stronger.

    The Liberals, and even more the Nationals, know all this at some level but can no longer make a fight of it. Their political judgment is probably correct. Political parties must always deal with political reality. Gas is at least better than complete renewables madness. But the Coalition had no thought of this when it entered government. Its surrender on coal ought, though, at least be noted, given its grave implications for the national interest.

    GREG SHERIDANFOREIGN EDITOR
    Greg Sheridan, The Australian's foreign editor, is one of the nation's most influential national security commentators, who is active across television and radio and also writes extensively on culture. He has w... Read more

    Share this article

  9. 276
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  10. 3.2k
    Posts

    High-Yield Note And Option Combo Funds TerraCom Bauxite Expansion
    By James Dunn | More Articles by James Dunn

    RELATED COMPANIESTERRACOM LIMITED

    An innovative, high-yielding Australian Securities Exchange (ASX)-listed note will be at the centrepiece of a capital raising and debt refinancing being conducted by aspiring diversified miner, TerraCom Limited, the combination of which will fund an expansion into a bauxite project in the West African nation of Guinea.

    TerraCom plans a low-cost operation in Guinea that could export up to 5 million metric tonnes of bauxite a year, from a total mineral resource of 73 million tonnes. The company estimates a 13-month development program could take it from “boots on the ground” to first ore shipment.

    The vehicle for the Guinea project is Anglo-African Minerals plc: in February, TerraCom struck a binding term sheet to acquire AAM and its three bauxite projects in Guinea, partnering with the private office of Sheikh Ahmed Bin Dalmook Al Maktoum (a member of Dubai’s ruling family) to do so. TerraCom paid a $US500,000 refundable deposit for an exclusivity period until 31 August 2020 – this was subsequently extended to 31 October.

    TerraCom is focused on bringing the smallest of the three bauxite plays owned by AAM, the Forward African Resources (FAR) project, to market, targeting 70 million tonnes of export quality bauxite resources. The company expects an initial production rate of 3 million tonnes per annum (mtpa), between 13 and 16 months from the start of development work, increasing to 5 mtpa over the following 12 months.

    That would provide welcome commodity diversification from TerraCom’s coal focus, which has been augmented this year by the acquisition of Universal Coal plc (completed in June 2020). Universal brings with it four operating thermal coal mines in South Africa – Kangala, the New Clydesdale Colliery, the North Block Complex and Ubuntu – which collectively produce 12.4 mtpa of thermal coal, with their output underpinned by offtake agreements with the country’s state-owned utility, Eskom. Universal also has two thermal coal development projects in South Africa – Eloff and Arnot South – and one coking coal project, Berenice/Cygnus.

    With Blair Athol in Queensland – where it is the owner-operator – that gives TerraCom annual run-of-mine production of 14.8 mtpa of thermal coal.

    With a production profile that is 100% coal – and thermal coal, at that – TerraCom wants to move this to 60% thermal coal, 40% bauxite, as soon as practicable, both for commodity diversification and to lessen the ESG (environmental, social and governance) risk of being wholly a thermal coal producer.

    The plan requires a refinancing of TerraCom’s debt profile, which at present encompasses US$163.6 million ($233.7 million) in debt, or net debt of US$122 million ($174.3 million) if its cash at-bank is excluded.

    A central plank of the refinancing is to raise $220 million through the issue of 220 million ASX-listed Notes at $1 each, paying a floating rate calculated quarterly on the first day of each quarter at the 90-day bank bill swap rate (BBSW) plus margin of 800 basis-points (8%) a year. But in an Australian capital markets first, the Notes will carry American-style equity options (that is, exercisable into TER shares at any time), on the basis of three attaching options over an unissued share in TerraCom for every four Notes issued. The options will be fully transferable and quoted on ASX. If all options are exercised, this would increase TerraCom’s cash at bank by $41.25 million.

    You’ve got listed bonds and you’ve got listed options, effectively creating a ‘buy-write’ strategy for the buyer of the Notes, only that your upside increases exponentially upon success, as opposed to being ‘called away’,” says Christian Baylis, the lead advisor and arranger of the issue.

    “The reason we structured it like that is because the upside in the equity will be as a result of the refinancing taking place. The capital raising – that is, the issue of the Notes – will be a catalyst for equity upside in TER shares, and we thought the buyers of the Notes deserve to participate in that equity upside. You can have the cake and eat it, so to speak” says Baylis.

    TerraCom debt provider, investment management firm OCP Asia – which holds a $25.4 million convertible note – is the cornerstone investor for the Notes, subscribing for $80 million. Gleneagle is pitching the rest at both institutional and retail investors, firmly in the high-yielding securities market – which brings into play investors such as self-managed superannuation (SMSF) funds.

    “At 800 basis points over BBSW, call it a coupon of 8%–8.5% over the three-year life of the asset,” says Baylis. “Plus, you then get the options on top, which will effectively juice-up the yield, depending on what happens with the share price. Our working assumption would be that the refinancing gets done, and subsequently the equity price goes up: let’s assume, for example, that the share price goes to 50 cents. In that case, you would be making an annualised return of about 14% over the life of the bond.”

    In return, a portion of the funds the Noteholders’ subscribe will be used to service the refinancing, while a further portion will be used to develop the bauxite assets, with some of the funding providing working capital.

  11. 276
    Posts
  12. 3.2k
    Posts

    High-Yield Note And Option Combo Funds TerraCom Bauxite Expansion
    By James Dunn | More Articles by James Dunn

    RELATED COMPANIESTERRACOM LIMITED

    An innovative, high-yielding Australian Securities Exchange (ASX)-listed note will be at the centrepiece of a capital raising and debt refinancing being conducted by aspiring diversified miner, TerraCom Limited, the combination of which will fund an expansion into a bauxite project in the West African nation of Guinea.

    TerraCom plans a low-cost operation in Guinea that could export up to 5 million metric tonnes of bauxite a year, from a total mineral resource of 73 million tonnes. The company estimates a 13-month development program could take it from “boots on the ground” to first ore shipment.

    The vehicle for the Guinea project is Anglo-African Minerals plc: in February, TerraCom struck a binding term sheet to acquire AAM and its three bauxite projects in Guinea, partnering with the private office of Sheikh Ahmed Bin Dalmook Al Maktoum (a member of Dubai’s ruling family) to do so. TerraCom paid a $US500,000 refundable deposit for an exclusivity period until 31 August 2020 – this was subsequently extended to 31 October.

    TerraCom is focused on bringing the smallest of the three bauxite plays owned by AAM, the Forward African Resources (FAR) project, to market, targeting 70 million tonnes of export quality bauxite resources. The company expects an initial production rate of 3 million tonnes per annum (mtpa), between 13 and 16 months from the start of development work, increasing to 5 mtpa over the following 12 months.

    That would provide welcome commodity diversification from TerraCom’s coal focus, which has been augmented this year by the acquisition of Universal Coal plc (completed in June 2020). Universal brings with it four operating thermal coal mines in South Africa – Kangala, the New Clydesdale Colliery, the North Block Complex and Ubuntu – which collectively produce 12.4 mtpa of thermal coal, with their output underpinned by offtake agreements with the country’s state-owned utility, Eskom. Universal also has two thermal coal development projects in South Africa – Eloff and Arnot South – and one coking coal project, Berenice/Cygnus.

    With Blair Athol in Queensland – where it is the owner-operator – that gives TerraCom annual run-of-mine production of 14.8 mtpa of thermal coal.

    With a production profile that is 100% coal – and thermal coal, at that – TerraCom wants to move this to 60% thermal coal, 40% bauxite, as soon as practicable, both for commodity diversification and to lessen the ESG (environmental, social and governance) risk of being wholly a thermal coal producer.

    The plan requires a refinancing of TerraCom’s debt profile, which at present encompasses US$163.6 million ($233.7 million) in debt, or net debt of US$122 million ($174.3 million) if its cash at-bank is excluded.

    A central plank of the refinancing is to raise $220 million through the issue of 220 million ASX-listed Notes at $1 each, paying a floating rate calculated quarterly on the first day of each quarter at the 90-day bank bill swap rate (BBSW) plus margin of 800 basis-points (8%) a year. But in an Australian capital markets first, the Notes will carry American-style equity options (that is, exercisable into TER shares at any time), on the basis of three attaching options over an unissued share in TerraCom for every four Notes issued. The options will be fully transferable and quoted on ASX. If all options are exercised, this would increase TerraCom’s cash at bank by $41.25 million.

    You’ve got listed bonds and you’ve got listed options, effectively creating a ‘buy-write’ strategy for the buyer of the Notes, only that your upside increases exponentially upon success, as opposed to being ‘called away’,” says Christian Baylis, the lead advisor and arranger of the issue.

    “The reason we structured it like that is because the upside in the equity will be as a result of the refinancing taking place. The capital raising – that is, the issue of the Notes – will be a catalyst for equity upside in TER shares, and we thought the buyers of the Notes deserve to participate in that equity upside. You can have the cake and eat it, so to speak” says Baylis.

    TerraCom debt provider, investment management firm OCP Asia – which holds a $25.4 million convertible note – is the cornerstone investor for the Notes, subscribing for $80 million. Gleneagle is pitching the rest at both institutional and retail investors, firmly in the high-yielding securities market – which brings into play investors such as self-managed superannuation (SMSF) funds.

    “At 800 basis points over BBSW, call it a coupon of 8%–8.5% over the three-year life of the asset,” says Baylis. “Plus, you then get the options on top, which will effectively juice-up the yield, depending on what happens with the share price. Our working assumption would be that the refinancing gets done, and subsequently the equity price goes up: let’s assume, for example, that the share price goes to 50 cents. In that case, you would be making an annualised return of about 14% over the life of the bond.”

    In return, a portion of the funds the Noteholders’ subscribe will be used to service the refinancing, while a further portion will be used to develop the bauxite assets, with some of the funding providing working capital.

  13. 276
    Posts

    Where is the cashed up investors?
    https://youtu.be/EjR195Ab1t4

  14. 3.2k
    Posts

    Coal gift..imo dyor

  15. 276
    Posts

    There is always plenty of gifts in this world
    https://youtu.be/Lhuzbdp0AHE

  16. 3.2k
    Posts

    High Yield Note For Retail Investors To Fund Terracom Expansion
    By James Dunn | More Articles by James Dunn

    RELATED COMPANIESTERRACOM LIMITED

    An innovative, high-yielding Australian Securities Exchange (ASX)-listed note will be at the centrepiece of a capital raising and debt refinancing being conducted by aspiring diversified miner, TerraCom Limited, the combination of which will fund an expansion into a bauxite project in the West African nation of Guinea.

    TerraCom plans a low-cost operation in Guinea that could export up to 5 million metric tonnes of bauxite a year, from a total mineral resource of 73 million tonnes. The company estimates a 13-month development program could take it from “boots on the ground” to first ore shipment.

    The vehicle for the Guinea project is Anglo-African Minerals plc: in February, TerraCom struck a binding term sheet to acquire AAM and its three bauxite projects in Guinea, partnering with the private office of Sheikh Ahmed Bin Dalmook Al Maktoum (a member of Dubai’s ruling family) to do so. TerraCom paid a $US500,000 refundable deposit for an exclusivity period until 31 August 2020 – this was subsequently extended to 31 October.

    TerraCom is focused on bringing the smallest of the three bauxite plays owned by AAM, the Forward African Resources (FAR) project, to market, targeting 70 million tonnes of export quality bauxite resources. The company expects an initial production rate of 3 million tonnes per annum (mtpa), between 13 and 16 months from the start of development work, increasing to 5 mtpa over the following 12 months.

    That would provide welcome commodity diversification from TerraCom’s coal focus, which has been augmented this year by the acquisition of Universal Coal plc (completed in June 2020). Universal brings with it four operating thermal coal mines in South Africa – Kangala, the New Clydesdale Colliery, the North Block Complex and Ubuntu – which collectively produce 12.4 mtpa of thermal coal, with their output underpinned by offtake agreements with the country’s state-owned utility, Eskom. Universal also has two thermal coal development projects in South Africa – Eloff and Arnot South – and one coking coal project, Berenice/Cygnus.

    With Blair Athol in Queensland – where it is the owner-operator – that gives TerraCom annual run-of-mine production of 14.8 mtpa of thermal coal.

    With a production profile that is 100% coal – and thermal coal, at that – TerraCom wants to move this to 60% thermal coal, 40% bauxite, as soon as practicable, both for commodity diversification and to lessen the ESG (environmental, social and governance) risk of being wholly a thermal coal producer.

    The plan requires a refinancing of TerraCom’s debt profile, which at present encompasses US$163.6 million ($233.7 million) in debt, or net debt of US$122 million ($174.3 million) if its cash at-bank is excluded.

    A central plank of the refinancing is to raise $220 million through the issue of 220 million ASX-listed Notes at $1 each, paying a floating rate calculated quarterly on the first day of each quarter at the 90-day bank bill swap rate (BBSW) plus margin of 800 basis-points (8%) a year. But in an Australian capital markets first, the Notes will carry American-style equity options (that is, exercisable into TER shares at any time), on the basis of three attaching options over an unissued share in TerraCom for every four Notes issued. The options will be fully transferable and quoted on ASX. If all options are exercised, this would increase TerraCom’s cash at bank by $41.25 million.

    You’ve got listed bonds and you’ve got listed options, effectively creating a ‘buy-write’ strategy for the buyer of the Notes, only that your upside increases exponentially upon success, as opposed to being ‘called away’,” says Christian Baylis, the lead advisor and arranger of the issue.

    “The reason we structured it like that is because the upside in the equity will be as a result of the refinancing taking place. The capital raising – that is, the issue of the Notes – will be a catalyst for equity upside in TER shares, and we thought the buyers of the Notes deserve to participate in that equity upside. You can have the cake and eat it, so to speak” says Baylis.

    TerraCom debt provider, investment management firm OCP Asia – which holds a $25.4 million convertible note – is the cornerstone investor for the Notes, subscribing for $80 million. Gleneagle is pitching the rest at both institutional and retail investors, firmly in the high-yielding securities market – which brings into play investors such as self-managed superannuation (SMSF) funds.

    “At 800 basis points over BBSW, call it a coupon of 8%–8.5% over the three-year life of the asset,” says Baylis. “Plus, you then get the options on top, which will effectively juice-up the yield, depending on what happens with the share price. Our working assumption would be that the refinancing gets done, and subsequently the equity price goes up: let’s assume, for example, that the share price goes to 50 cents. In that case, you would be making an annualised return of about 14% over the life of the bond.”

    In return, a portion of the funds the Noteholders’ subscribe will be used to service the refinancing, while a further portion will be used to develop the bauxite assets, with some of the funding providing working capital.

  17. 3.2k
    Posts

    I congratulate management on the production cost of $57 per ton in the 30.09.20 quarter at Blair Athol.. The apparent market value for the quarter is about us$ 59 per ton which at the exchange rate of 0.07 aussie is about $84 per ton. this indicates the profit on the Blair Athol mine on the sales of 620,000 tons is some $15.5mil for the quarter. This plus the four profitable South African mines puts the company annual profit for one year way above the Market cap of $116m at 15.5c per share. I have a feeling that this share is very much undervalued at 15.5c per share.
    Time to load up I think.

  18. 3.2k
    Posts

    TerraCom looks to finalise new finance with eye on nickel market
    The Blair Athol coal mine in Queensland is TerraCom’s main Australian asset.
    The Blair Athol coal mine in Queensland is TerraCom’s main Australian asset.
    BRIDGET CARTER
    DATAROOM EDITOR
    10:27PM NOVEMBER 18, 2020NO COMMENTS
    Special situation funds Oaktree Capital Management, Anchorage Capital Group, The Carlyle Group and Apollo Global Management are believed to be in TerraCom’s data room for a potential refinancing of the Australian-listed coal miner.

    The resources company chaired by Wal King — the former boss of Leighton Holdings (now called CIMIC) — has operating assets in Australia and South Africa and is looking to refinance debt worth $220m ahead of its repayment deadline next June.

    Current lenders include OCP Asia and Hong Kong-based commodity trader Noble Group Holdings.

    READ NEXT

    WEALTH
    Reading signs behind Buffett’s gold dalliance
    JAMES KIRBY
    It is understood that OCP is prepared to remain a lender, committing $80m towards the debt refinance, but Noble has challenges elsewhere.

    Noble has been buying back debt on some of its investments, according to market sources.

    The company was embroiled in an accounting fraud case in 2015 that eventually led to a restructuring.

    READ MORE:Elliott closes in on coal assets|China tension, investment could hit junior miners
    TerraCom’s main Australian asset is the Blair Athol Coal Mine in central Queensland, which is considered a strong performer in the sector, given that the mine has the lowest production costs in the country.

    The mine produces 2.7 million tonnes per annum of high quality thermal coal that is exported to markets including Japan and Korea.

    TerraCom also purchased Universal Coal in South Africa in the past year, which holds a portfolio of producing, development and exploration assets across South Africa’s major coal fields.

    Special situation funds are closing in on lending opportunities in the coal space as traditional banks shy away from the sector due to environmental concerns surrounding coal.

    New & improved business newsletter. Get the edge with AM and PM briefings, plus breaking news alerts in your inbox.

    Sign up
    However, some believe that the coal price will stage an uplift in 2021.

    Oaktree has recently purchased debt for 71c in the dollar in the Western Australia-based Bluewaters Power Station after its lending syndicate offloaded loans in the coal-fired asset.

    The Los Angeles-based fund is also considering a recapitalisation of the food and milk product producer Freedom Foods, along with Anchorage Capital Group and Sixth Street Partners — the fund that until recently was part of the US-based private equity firm TPG Capital.

    TPG continues to hold a small investment in the business.

    Advising TerraCom is a former lead portfolio manager for UBS Asset Management, Christian Baylis, who has recently launched the boutique fund manager Fortlake Asset Management, backed by wealthy investor Alex Waislitz.

    The fund manager is seeded by $150m worth of funds and is embarking on a fundraising exercise as it targets fixed income and real returns investments for wholesale and retail clients.

    Sub advisers to TerraCom include Skye Capital Advisory and KPMG.

    It is understood that TerraCom has aspirations to expand into the nickel market once its refinancing is finalised – likely by the end of this month.

    It is also looking at a bauxite mine in Guinea.

    At the end of June 30, TerraCom had a $97m market value with $US163.6m of debt and $US41.6m of cash.

    It generated $4.1m of net profit for the 2020 financial year, as the thermal coal price came under pressure.

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    I was surprised to read about TER's apparent interest in Nickel yesterday too...first I'd heard of it...thankfully TER issued clarification today that they have no interest in Nickel...

    ...the shite people write....

    Best to all holders as the Coal Price continues to rise...not so sure about African sovereign risk as the way forward (I guess if RIO does Simandou there should be some new infrastructure in Conakry which is at present a run down shithole)...having just blown M$200 in Mongolia you'd reckon some consolidation of the South African and Australian assets might be the more important order of business.

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