As disclosed in the news release on 5 February this year, the corporate finance team of Industrial Alliance Securities Inc. (IA) and US-based Heritage Capital Group Inc. have implemented a detailed process aimed at securing both debt and equity for one of Gensource’s potash projects. The company claims that, to date, a number of large US-based agricultural lenders, insurance companies, private equity groups and Canadian-based financial institutions have entered the financing process.
As a part of the process, Gensource claims that all financial institutions have entered into non-disclosure agreements (NDAs) and, as a result, have provided access to a robust and secure electronic data room of project and company information. The financial institutions have been targeted as partners because of their specific experience in agriculture, mining and natural resource extraction industries, and/or distinct project finance capabilities. Their collective capabilities span project financing, long-term senior debt, mezzanine financing and equity capital, which would allow for structuring of a complete and prudent long-term capital structure for the Vanguard One project. Gensource claims that the comments received from the financial institutions during the detailed project review will be incorporated into the definitive offtake agreements being completed between Gensource and its offtake partners pursuant to the signed MoUs disclosed in news releases on 22 March and 27 March 2018. Gensource remains on track to substantially complete a definitive offtake agreement by the end of April, with announcements following within the next few weeks. As discussions advance through the financing process, Gensource hopes to announce a lead bank for project financing before the end of May 2018.
The President and CEO of Gensource, Mike Ferguson, said: “The process of assembling the project finance package begins with making sure the right financial institutions are involved in the process. With IA and Heritage groups leading the way, we see that some very credible and experienced agriculture industry financial players are taking serious interest in the project and jumping into the process that we expect will lead to the full project finance package. With so many details to be settled, timing is always difficult to pin down definitively, but if our current schedule remains intact, we maintain our target of beginning construction activities this summer.”
Read the article online at: https://www.worldfertilizer.com/potash/27042018/gensource-provides-project-financing-update/