Gulf Manganese Corporation has secured approximately A$15 million equivalent funding led by Indonesian-based diversified investment group PT Jayatama Tekno Sejahtera (PT JTS).
PT Gulf Mangan Grup (PT Gulf) will issue a convertible note, in an Indonesian Rp (“DR) principal amount equivalent to approximately A$6 million, with a zero percent interest to PT JTS’s wholly-owned subsidiary, PT Jayatama Global Ivestindo (PT JGI) Upon satisfaction of the agreed conditions precedent, the PT Gulf Convertible Note will automatically be converted in 25.1% of the equity of PT Gulf.
An additional standby facility, in an IDR principal amount equivalent to approximately A$7 million, has also been made available by PT JTS to PT Gulf.
The securing of this funding package enables Gulf to complete the construction and commissioning of the first two smelters at the Company’s Kupang Smelting Hub Facility in West Timor. Gulf anticipates commencing ferromanganese alloy production by mid-2018, at which point the Company expects to be initially producing approximately 30,000 tonnes per annum premium quality ferromanganese alloy.
Chairman and CEO of PT JTS, Bpk Fofo Sariaatmadja commented, “We are excited to be part of the Gulf team and look forward to working together with the team to bring the smelters to full production and beyond. We believe the potential of this Company to benefit both Gulf shareholders and members of the local Kupang community is immense, and we will do what we can to help the Company realise that potential.”
Gulf’s Managing Director, Hamish Bohannan concurs that this a “game-changing transaction for Gulf”.
“The Board is very pleased to have attracted a highly-respected Indonesian partner such as PT JTS, as it now provides the Company with a very clear and defined pathway through to production this year.
“PT JTS completed a very thorough and extensive due diligence process and its willingness to invest in Gulf is a strong validation of our near-term plans and future vision for the establishment of this regionally significant manganese smelting facility in West Timor.
“With all relevant approvals and funding now in place, we are entering a very exciting period where we expect considerable shareholder value to be unlocked over coming months.”