Kore Potash secures $2.2 billion funding term sheets

REPUBLIC OF CONGO - Kore Potash Plc (AIM:KP2, ASX: KP2, JSE: KP2, A2X: KP2), a potash development company, has announced the signing of non-binding term sheets with OWI-RAMS GMBH for approximately $2.2 billion in funding for its Kola Potash Project in the Sintoukola Basin, Republic of Congo. This step is part of the company’s strategy to contribute to global food security and stimulate economic growth within the region.

The proposed funding package from OWI-RAMS, an investment platform based in Switzerland, is structured to include both senior secured project finance and royalty financing. The arrangement aligns with Shariah principles and aims to minimize shareholder dilution while maintaining a focus on long-term sustainability and value creation.

David Hathorn, Chairman of Kore Potash, emphasized the importance of the Kola Project in addressing global agricultural resilience and securing essential nutrient supply chains. The company remains committed to working with strategic partners to meet the remaining requirements for the project.

The financing includes a Senior Secured Project Facility amounting to around $1.53 billion, intended to cover 70% of the total estimated funding requirement. The terms include a fixed profit payment between 6.8% and 9.3% per annum, a grace period during the construction and ramp-up phase, and a reserve account setup. The Royalty Finance Facility, representing the remaining 30% of the funding requirement at approximately $655 million, is structured as a participatory instrument with the financier entitled to a share of gross revenues over the life of the mine.

Kore Potash’s arrangement with OWI-RAMS is expected to be less dilutive than traditional equity funding, as it avoids the issuance of new shares and preserves existing shareholder ownership. The funding package will support the development, construction, commissioning, and associated costs of the Kola Project.

The financing is subject to the completion of due diligence and the finalization of binding legal agreements. The company and OWI-RAMS aim to commence project construction in early 2026. The non-binding nature of the term sheets means there is no set termination date, and the final structure of the financing will be determined in consultation with Shariah advisors appointed by the financier.

The Kola Project, with a projected annual EBITDA of approximately $733 million, is designed to become one of the lowest-cost producers in the global agricultural market. The project is expected to have a significant impact on food security, with potash from Kola enabling downstream opportunities in regions such as Africa and Brazil.

This news is based on a press release statement and does not constitute financial advice or an endorsement of the company’s claims. Investors are advised to conduct their own due diligence before making investment decisions.

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