This is fantastic news, however this is also a double edged...

This is fantastic news, however this is also a double edged sword.

The positives are clearly known, KIS full project funding is a step closer. However the negatives to this joint debt arrangement is that it makes it very complex to negotiate another debt provider (especially a big bank) on a pari passu footing and I can certainly guarantee that no bank debt provider will want anything less.

I'm with you @Comptonfarm there are a lot of unknowns about this deal that would have been nice to have answered / released to the market at the time of the announcement.

My background was in commercial banking, - until leaving to start my own business - specifically working as part of the team that structured finance and everyday transaction banking requirements for large corporations. Finance deals like this one will make it harder for another debt provider to step up to the plate. It's unfortunate but I'm starting to think that if the remining funds are not coming from the government by way of a grant then KIS and us share holders may be in for a large share placement capital raising.

We can see that a equipment finance leasing facility is being separately negotiated which is normal for these companies and it shouldn't effect the structure of this new lending arrangement, however if KIS was to bring in a new lender for the remaining of the debt then it would be a very long a diluted process so that new creditor right of set off is accepted by all existing creditors and that the new creditor accepts existing terms in place. Just doing this between 2 parties (e.g bank A and bank B) is a big task that involves a load of legal negotiation. So can you imagine the task if it involved the government, a syndication of 5 separate finances and then a new lender brought in after the initial agreement? The announcement already states that KIS are now going back to the TAS government to renegotiate the original agreement, this is the process every time a new lender is brought in post an agreement. Although it wasn't possible the ideal scenario is that all lenders / creditors are brought together at the same time so that the legal documents are reviewed by all parties and necessary amendments are agreed on together.

In conclusion I would not say that another creditor (aside from the equipment finance provider) isn't possible but I will say that it will be a tricky and laborious process. If KIS already knows that a grant is not likely then they should have been trying to get traditional finance (a bank) to participate in the syndicate loan that they now have.

I still believe KIS represents a great opportunity I just really hope it doesn't come at cost of massive share dilution!