Nevada Copper closes initial stage of transformational business recapitalization and project financing

January 19, 2018

Torys represented Nevada Copper with a team that included Michael Amm, Janan Paskaran, Tom Zverina, Peter Danner and Michael Jason.

On December 22, 2017, Nevada Copper Corp. (“Nevada Copper”) announced that it entered into arrangements for a US$378 million construction financing and recapitalization package in connection with its 100%-owned Pumpkin Hollow Copper Property (the “Project”), currently the only fully-permitted copper project of scale in the United States.

The construction financing and recapitalization package is to be provided by Triple Flag Mining Finance Bermuda Ltd. (“Triple Flag”), Pala Investments Ltd. (“Pala”), RK Mine Finance (“Red Kite”), Concord Resources Ltd. (“Concord”) as well as several institutional equity investors including JP Morgan Asset Management UK, and is comprised of the following:

  • US$70 million precious metals stream (relating only to precious metal production from the underground mine at the Project) from Triple Flag;
  • US$80 million senior secured loan from Red Kite;
  • US$53 million debt to equity conversion by Red Kite and Pala;
  • US$25 million working capital facility which Concord has been mandated to arrange for Nevada Copper;
  • US$100 million equity commitment from various equity investors including Pala; and
  • US$50 million equity backstop from Pala which can be utilized at Nevada Copper’s option for subsequent equity offerings.

On January 19, 2018, Nevada Copper announced the closing of the initial stage of the overall recapitalization transaction, including the private placement of 256,410,256 special warrants for aggregate gross proceeds of approximately US$100 million.

Full details on the package can be found on Nevada Copper’s website.

The Pumpkin Hollow Copper Property is a large advanced stage development copper property with substantial reserves and resources including copper, gold, silver, as well as a large iron resource. The Project consists of two proposed copper mines: (1) a near-production, high-grade underground mine with an existing production-size shaft and infrastructure; and (2) a large-scale open pit project with resource upside and optionality to pursue a staged-development plan.

Nevada Copper owns 100% of the Pumpkin Hollow Copper Property located in Nevada, United States.

Triple Flag, consisting of Triple Flag Mining Finance Bermuda Ltd. and Triple Flag Mining Finance Ltd., is one of the largest global private investment firms dedicated to the mining industry, with a primary focus on precious metal streaming and royalty investments.

Red Kite provides bespoke financing solutions to base and precious metals focused mining companies including bridge finance, construction finance, expansion funding, working capital and acquisition facilities.

Pala is a multi-strategy investment company focused on the mining and metals value chain with a strong record of successful investments and value creation. 

Concord is a global resources merchant focused on the supply chain and risk management of nonferrous metals and their associated raw materials.


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