Altech Chemicals Ltd receives lenders first draft indicative term sheet
Date
8/24/2016 1:59:23 AM
(MENAFN- ProactiveInvestors - Australia) Iggy Tan, managing director, Altech Chemicals Ltd
Altech Chemicals Ltd (ASX:ATC) has received a summary of senior facility agreement indicative terms and conditions from German government-owned KfW IPEX-Bank for the proposed US$70 million of debt financing.
The financing is for Altech's Malaysian high purity alumina (HPA) project.
Iggy Tan, managing director for Altech, commented:
'The debt financing is progressing well and the senior facility agreement indicative terms and conditions presented by KfW IPEX-Bank is the next important step towards securing finance.
"The debt and ECA cover is still subject to due diligence and various loan approval steps, however receiving the indicative terms and conditions whilst a positive outcome but does not imply that the ECA or debt financing applications will be successful.”
Altech and KfW IPEX-Bank have now commenced detailed discussions and negotiations of the proposed facility agreement terms and conditions, which are not binding on either party.
Background
Altech is aiming to become one of the world's leading suppliers of 99.99% HPA.
HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required for the production of artificial sapphire.
Artificial sapphire is used in the manufacture of substrates for LED lights, semiconductor wafers used in the electronics industry and scratch-resistant artificial sapphire glass. Sapphire glass is used in models of the Apple watch.
There is no substitute for HPA in the manufacture of artificial sapphire.
Altech was recently granted its mining lease at Meckering, where it is planning to mine 120,000 tonnes of kaolin every three years on a campaign basis, each mining campaign will last two months.
The resultant raw kaolin will be stockpiled, then containerised into standard shipping containers at the rate of around 40,000 tonnes per annum and transported to Johor, Malaysia for processing into HPA at the company";s proposed plant.
Kaolin resource upgrade
Altech recently updated its kaolin resource at the wholly-owned HPA project in Meckering, Western Australia.
The updated Resource measures 11 million tonnes of kaolin clay containing 45% minus 45 micron clay with a brightness of 82.7%.
This resource will feed the proposed HPA plant in Malaysia for over 250 years.
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