IGO Limited

Western Areas Nickel Portfolio - Acquisition Financing

Borrower (s)
IGO Limited
Industry
Metals and Mining/Base metals
Area of finance
Project & Infrastructure Finance
Region
Australasia
Countries
Australia

Deal Overview

IGO Limited (“IGO”) is an ASX-listed diversified mining company with commodity exposure to nickel, copper and cobalt lithium both upstream and downstream. IGO’s portfolio includes the 100%-owned Nova nickel-copper-cobalt operation whilst it has a 24.9% interest in the Greenbushes...

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IGO Limited (“IGO”) is an ASX-listed diversified mining company with commodity exposure to nickel, copper and cobalt lithium both upstream and downstream. IGO’s portfolio includes the 100%-owned Nova nickel-copper-cobalt operation whilst it has a 24.9% interest in the Greenbushes lithium mine and a 49% interest in the Kwinana lithium hydroxide plant through its Tianqi Lithium Energy Australia Pty Ltd (TLEA) joint venture with Tianqi Lithium Corporation

(Tianqi). In April 2022 IGO announced it had agreed to acquire 100% of ASX-listed nickel producer Western Areas Limited (“WSA”) for total cash consideration of A$1.3bn (the Transaction) via an Amended Scheme of Arrangement. The Amended Scheme follows an agreement by IGO to increase the consideration from A$1.1bn, proposed in an initial scheme of arrangement in Dec 2021, and has been unanimously recommended by the Western Areas Board. IGO provided the revised offer following an Independent Expert’s report finding the initial offer not fair nor reasonable and WSA withdrawing their support. The Transaction aligns with IGO’s strategy of becoming a globally relevant supplier of metals critical to enabling clean energy. For IGO, acquiring WSA would restock its nickel pipeline at a time when its Nova nickel mine has only an estimated five years left of production. To fund the A$1.3bn purchase consideration, IGO intends to restructure its existing A$450m amortizing facility into a new senior secured debt facility of A$900m underwritten by ANZ, CBA and NAB (together the MLAUBs). The Facilities include a A$540m amortizing term facility (Facility A) and a A$360m revolving facility (Facility B) (the Facilities) both with a 3-year tenor. IGO will fund the remainder with cash of A$453m from existing cash reserves.

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Deal Volume
$ 624.09m
Financial Close
20 June 2022
Sources
Submitted by participant(s)

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Projects

Western Areas Nickel Portfolio

Brownfield
Base metals
Australasia
Australia
$ 906m