Bushveld Minerals Limited Further Update on Outstanding Funds (3519A)

TIDMBMN

RNS Number : 3519A

Bushveld Minerals Limited

19 January 2024

Market Abuse Regulation ("MAR") Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

19 January 2024

Bushveld Minerals Limited

("Bushveld" or the "Company")

Further update on Outstanding Funds

Further to the Company's announcement on 15 January 2024, Bushveld Minerals Limited (AIM: BMN), the integrated primary vanadium producer, remains in regular communication with Southern Point Resources ("SPR"). Despite previous assurances provided by SPR regarding late transfer of funds to the Company being a result of processing delays, SPR has since identified and informed the Company that the delay in settlement of funds is due to one of its institutional funding partners defaulting on an agreement with SPR to commit the funds to satisfy SPR's obligations to the Company. In order to mitigate its breach, SPR is working with its partners to provide an alternative source of funding to resolve the default as soon as possible.

The Company has today received payment of ZAR40 million (US$2 million) from SPR which has been provided on an interest free basis and will be repaid once SPR provides Bushveld with the entire US$12.5 million, pursuant to the SPR subscription agreement (the "Subscription Agreement"). Under the Subscription Agreement, SPR was due to transfer the US$12.5 million from an offshore bank account into Bushveld's UK bank account. However, due to the events that have recently transpired, the payment received today has been paid into a Bushveld subsidiary's South African bank account from SPR's bank account in South Africa. If the funds received today were to be used to satisfy SPR's obligation under the Subscription Agreement, approval of the South African Reserve Bank would have been required, which would have resulted in further delays in flow of funds. Until the entire US$12.5 million is received SPR remains in default of the Subscription Agreement.

As a result of the delayed settlement, the Company estimates that approximately two weeks production will be lost in January. In addition, the kiln at Vametco is currently being shutdown in order to be refurbished. Additionally, the Company is assessing the impact on production levels beyond January. Based on the Company's current working capital requirements, the Board anticipates Bushveld to have sufficient working capital to sustain the business until the end of February 2024, albeit at reduced production levels. SPR have communicated that the full US$12.5 million will be paid no later than the 28 February 2024.

The Board continues to monitor the situation closely and is working with its creditors and stakeholders, including Orion Mine Finance, to manage the financial condition of the Company.

Craig Coltman, CEO of Bushveld Minerals commented :

"While very frustrating that the full funds have to date failed to materialise, the Board and Management continue to engage actively and constructively with SPR. We are encouraged to receive this first payment from SPR whilst they work with one of their founding partners to resolve the default. We will provide further updates as appropriate with a view to resolving this as quickly as possible."

SPR commented:

"The delay in payment of committed funds from an institutional investor is disappointing, and has caused us a delay in settling our equity funding commitment, we continue to engage in promising discussions with senior representatives at the institution to make good upon their commitment.

Notwithstanding the difficult situation we are fully committed to our package of investments into Bushveld, and in lieu of the committed institutional capital, we have worked urgently to make arrangements with alternative limited partner funding to make good on our contractual commitments to the Company. We look forward to concluding the remaining transactions and crystalising our long term partnership with Bushveld Minerals."

Enquiries : [e-mail]

 
Bushveld Minerals Limited                               [phone] 
Craig Coltman, Chief Executive 
 Officer 
Chika Edeh, Head of Investor 
 Relations 
 
SP Angel Corporate Finance          Nominated Adviser       [phone] 
 LLP                                 & Joint Broker                    0470 
Richard Morrison / Charlie 
 Bouverat 
Grant Barker / Richard Parlons 
 
                                                            [phone] 
Hannam & Partners                   Joint Broker                       8500 
Andrew Chubb / Matt Hasson 
 / Jay Ashfield 
 
                                                            [phone] 
Tavistock                           Financial PR                       3150 
Gareth Tredway / Tara Vivian-Neal 
 / James Whitaker 
 

ENDS

ABOUT BUSHVELD MINERALS LIMITED

Bushveld Minerals is a vertically integrated primary vanadium producer, it is one of only three operating primary vanadium producers. Bushveld has a diversified vanadium product portfolio serving the needs of the steel, energy and chemical sectors.

Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com

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January 19, 2024 11:32 ET (16:32 GMT)