This acquisition is a major transformation of RRP into a coal producer with the backing of its largest holder Taurus fund who own 87% of RRP stock. They are also funding the project with loans of a bridge loan of A$50m and a performance guarantee and working capital facility of US$98.5m. Queensland project purchased off Anglo for A$43.7 mill with an ongoing royalty paid to Anglo depending on average coal price sold starting at A$1.00 per tonne if the coal sales are at greater then A$105. Production in CY 2015 was 2.6 mill tonnes. RRP will own a 70% interest with Posco and Nippon owning 20% and 10% respectively. I believe this is a massive deal and great for shareholders.
RRP Price at posting:
0.7¢ Sentiment: Buy Disclosure: Held
