Minbos Resources Secures Strategic Investment for Cabinda Phosphate Project
MNB (MNB) Share Update November 2024 Wednesday 13th
Minbos Resources Secures $10M Investment from Angolan Sovereign Wealth Fund
Minbos Resources Limited (ASX:MNB) has announced a significant milestone by securing a US$10 million strategic investment from the Fundo Soberano de Angola, the Angolan Sovereign Wealth Fund. This investment will fully fund Phase-1 construction of the Cabinda Phosphate Project, marking a pivotal step in the project's development.
Instant Summary:
- Minbos signs $10M Subscription Agreement with Angolan Sovereign Wealth Fund.
- Funds to be received by Minbos' Mauritian subsidiary Phobos Ltd.
- Investment ensures no dilution of current Minbos shareholders' interests.
- Phase-1 construction activities to commence upon fund receipt.
- Investment supports local fertilizer distribution along the Lobito Corridor.
- Non-dilutive funding arrangements continue with IDC and Banco BAI.
Investment Details
Minbos Resources Limited has entered into a Subscription Agreement with the Fundo Soberano de Angola, securing a strategic investment of US$10 million. This investment will be channeled through Minbos' Mauritian subsidiary, Phobos Ltd, which holds the company's interests in the Cabinda Phosphate Project. The agreement ensures that there will be no dilution of current Minbos shareholders' interests in future projects.
Construction and Project Support
Upon receiving the first tranche of funds, Minbos will finalize the Civils contract, which includes essential construction activities such as earthworks, access roads, drainage, and concrete foundations. The mobilization of construction teams is set to begin shortly thereafter, signifying the commencement of Phase-1 construction activities.
Strategic Importance
This investment by the Angolan Sovereign Wealth Fund underscores strong support for the Cabinda Phosphate Fertilizer Project. It aligns with the fund's mission to generate long-term returns while contributing to the sustainable economic development of Angola. The project is expected to boost agricultural productivity by providing necessary inputs to local distributors along the Lobito Corridor, thereby enhancing food security in the region.
Funding Structure
The US$10 million investment will be distributed in three tranches: US$6.40 million for the execution of the Civils Contract, US$2.43 million upon contractor mobilization and governance alignment, and US$1.17 million upon finalizing project insurances and supplier quotations for long lead items.
This strategic investment is a positive development for Minbos Resources, as it provides the necessary capital to advance the Cabinda Phosphate Project without diluting shareholder value. The support from the Angolan Sovereign Wealth Fund highlights the project's potential impact on Angola's agricultural sector and its alignment with national development goals.
Investor Reaction:
Analysts are likely to view this investment as a strong endorsement of the Cabinda Phosphate Project's viability and potential. The non-dilutive nature of the funding is particularly positive for current shareholders, as it preserves their equity stake in future developments.
Conclusion:
Minbos Resources' partnership with the Angolan Sovereign Wealth Fund marks a significant advancement in the Cabinda Phosphate Project. Investors should monitor the project's progress and consider the long-term benefits of this strategic investment. The company's continued efforts to secure non-dilutive funding further enhance its growth prospects.