By Rebecca Melvin
New York, March 16 - Great Western Minerals Group Ltd. priced $80 million of five-year secured convertible bonds at par of $10,000 with a coupon of 8% and an initial conversion premium of 20%, according to a term sheet.
The Regulation S deal has a $10 million greenshoe and was brought by joint bookrunners GMP Securities LP and ISM Capital LLP, with Byron Capital Markets Ltd. as part of the syndicate.
Proceeds will be used to construct the mixed rare earth chloride and separation plants for Steenkampskraal mine and cracking plant, and further development and exploration, and for general working capital.
The bonds, which mature April 5, 2017, have an initial conversion price of C$0.66.
Holders have early redemption rights in the event of milestone failure and also change of control and delisting puts.
The company will not be permitted to pay dividends for three years after issue, but subsequently the bonds will have full dividend protection.
In connection with the offering, Great Western has agreed to use reasonable commercial efforts to consolidate its common shares on a 5 to 1 basis, or such other ratio as the company determines subject to shareholder and regulatory approval.
Application is being made to list the bonds on the PSM of the London Stock Exchange.
Settlement is expected on April 5.
Based in Saskatoon, Sask., Great Western Minerals is an integrated rare earths processor.
| Issuer: | Great Western Minerals Group Ltd.
|
| Issue: | Secured convertible bonds
|
| Amount: | $80 million
|
| Greenshoe: | $10 million
|
| Maturity: | April 5, 2017
|
| Bookrunners: | GMP Securities LP and ISM Capital LLP, with Byron Capital Markets Ltd. as part of the syndicate
|
| Coupon: | 8%
|
| Price: | Par, $10,000
|
| Yield: | 8%
|
| Conversion premium: | 20%
|
| Conversion price: | C$0.66
|
| Pricing date: | March 14
|
| Settlement date: | April 5
|
| Puts: | In the event of milestone failure as outlined in indenture
|
| Takeover protection: | Yes
|
| Dividend protection: | Yes, after three years
|
| Distribution: | Regulation S
|
| Stock symbol: | TSX Venture: GWG
|
| Stock price: | C$0.55 at close March 14
|
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