Anyone feel the synergy with Arafura, why and potential...

First 154 Last

Share
Profile

Follow
fluffynymph

56,462 Posts.

254

14/03/24

16:34

Post #: 72889571
Share
Originally posted by Jacko22: ↑

Under the deal with Inco/Vale, they were actually financing more like 98% of the capex. The deal was whatever the debt/equity ratio, Inco was to fund 100% of the debt component. The equity component was then based on the buy in (which was Inco 60% HRR 40%). So for HRR's 40%, Inco guaranteed HRR component (by way of loan - 80% of which was to be paid back out of future profits), but HRR had to initially fund 4.5% of the equity component up front as their share.

IB's example at the time went like this:
Agreed buy in percentage was Inco 60% / HRR 40%

IF: CAPEX: $1.4B and debt/equity funding was agreed at 70/30:
THEN:
Inco would fund 100% of debt component - $980M (70% of $1.4B)
Equity split is 60/40: Inco to fund $252M and HRR $168M
Of the HRR equity ($168M) required:
HRR required to fund 4.5% of the equity component upfront, so $19m (4.5% x $420m)
Inco would then lend the remainder of HRR's equity share, $149m (to be repaid from share of profits).

So HRR, in reality, would have only raised $19m to retain 40% of the project, and would have incurred none of the project costs.

Of course you would need to account for the fact that HRR had to repay the $149m loan to Inco 9over the life of the project), so in reality HRR's share of the $1.4B capex, was $168M (being 12% overall of the capex).
@Jogoo

Expand

Anyone feel the synergy with Arafura, why and potential speculation.
ARL Price at posting: 66.0¢ Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

Reply

There are more pages in this discussion • 18 more messages in this thread...

First 154 Last

Add ARL (ASX) to my watchlist

(20min delay)
Last 64.0¢		Change -0.020(3.03%)		Mkt cap ! $127.7M

Open	High	Low	Value	Volume
65.0¢	65.0¢	61.0¢	$139.9K	223.0K

Buyers (Bids)

No.	Vol.	Price($)
1	1588	63.0¢

Sellers (Offers)

Price($)	Vol.	No.
64.0¢	1034	1

View Market Depth

No.	Vol.	Price($)
1	1588	0.630
1	23547	0.625
2	7672	0.620
2	15725	0.610
3	9232	0.600

Price($)	Vol.	No.
0.640	1034	1
0.660	1052	1
0.670	11000	1
0.685	5000	1
0.690	1450	1

Last trade - 15.52pm 13/05/2024 (20 minute delay)


Last 62.5¢		Change -0.020 ( 3.85 %)
Open	High	Low	Volume
64.0¢	64.0¢	61.0¢	42211
Last updated 14.01pm 13/05/2024 ?

ARL (ASX) Chart

Anyone feel the synergy with Arafura, why and potential...

Featured News

Meet Sun Silver – ASX's newest silver-gold player based in Nevada, USA

D3E joins ASX as it hunts natural gas and helium in South Africa

Magnum to raise US$210M to advance Saudi green pig iron plant

Errawarra's pegmatite discovery in WA Pilbara strikes gold on ASX

Fletcher Building navigates uncertain market dynamics in FY24

Buyers (Bids)

Sellers (Offers)

Featured News

Anyone feel the synergy with Arafura, why and potential...

Featured News

Top Stories

Meet Sun Silver – ASX's newest silver-gold player based in Nevada, USA

D3E joins ASX as it hunts natural gas and helium in South Africa

Magnum to raise US$210M to advance Saudi green pig iron plant

Errawarra's pegmatite discovery in WA Pilbara strikes gold on ASX

Fletcher Building navigates uncertain market dynamics in FY24

Buyers (Bids)

Sellers (Offers)

Featured News