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MMG extends US$2.26B Las Bambas loan maturity to 11 years


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MMG extends US$2.26B Las Bambas loan maturity to 11 years

MMG Ltd. amended a loan agreement related to its 62.5%-owned Las Bambas copper-molybdenum-gold-silver joint venture operation in Peru.

In mid-2014, Top Create Resources Ltd. agreed to provide a four-year term loan of up to US$2.26 billion to cover MMG's share of equity contribution to the joint venture company related to the property. Top Create Resources is an MMG shareholder and a subsidiary of the company's controlling shareholder, China Minmetals Nonferrous Metals Co. Ltd.

MMG said Dec. 29 that the term of the loan was extended to 11 years and that the balance, originally due as one lump sum in July 2018, will now be paid in three tranches, with US$700 million due July 2021, US$700 million due July 2023 and the remainder due July 2025.

The annual interest payments were further postponed, from July 2017 to July 2018, and the existing floating interest rate will switch to a separate all-in fixed rate for each of the repayments, in the range of 3.70% and 4.50% per year, effective July 25, 2018.

MMG also reported that its Topstart Ltd. subsidiary is redeeming all of its convertible redeemable preference shares, originally due in 2038, within 10 days.

In 2013, the company issued 338 million convertible redeemable preference shares in Topstart for US$338 million. Under the deal, Alber Holdings Co. Ltd. acquired the right to receive annual dividends at a rate of 5% for eight years. Topstart notified Alber Holdings of the redemption, which MMG noted simplifies its capital structure and reduces funding costs.