Jubilee Metals settles remaining historic debt

Metals processing company Jubilee said on Monday that it has received notice from ACAM to convert its remaining convertible loan notes, totalling $7.8m (£5.89m) of principal debt and accrued interest, into new ordinary shares, meaning it was settling all of its historical debt.

The AIM-traded firm said the ACAM convertible note formed a key part in the funding of the acquisition and successful recapitalisation of its Sable Refinery, which launched its Zambian copper strategy.

It said the conversion would “completely eliminate” Jubilee's external debt position in relation to its Zambia operations, and release all securities held over its Zambian assets.

The settlement of all debt and release of the security would allow Jubilee to leverage its balance sheet for structured debt funding of its Zambian copper strategy, with the board confirming that both the company's Zambian and South African operations carried no further long-term secured debt.

Being “substantially debt-free” would form the basis for any future raising of new and “advantageously-priced” bank funding, the board explained, for further development of its global strategy.

It added that ACAM as a strategic shareholder in Jubilee had expressed a “keen interest” to seek further funding opportunities with the company, in support of its growth strategy in Zambia.

“The conversion of all of Jubilee's debt to ACAM is a historic moment for the company and a ringing endorsement of the success of our strategy to date and our focus going forward,” said chief executive officer Leon Coetzer.

“Having ACAM's support as an institutional investor over recent years, and indeed going forward remaining a substantial investor, has been critical in the in the acquisition of our Zambian assets, including the Sable Refinery, establishing the crucial foundation for entry into Zambia and the development and implementation of our copper and cobalt strategy.

“With Project Roan's integrated copper concentrator fast nearing completion and imminent production ramp-up, and Project Lechwe, our second planned copper processing facility, undertaking final design pilot runs, our fully funded and capitalised southern Zambian strategy becomes debt free - a fantastic position to be in.”

Coetzer described Zambia as a “true success story”, which the company would look to expand and replicate.

“The recent success of our Zambian strategy demonstrates how, in a relatively short period of time compared with mining projects, Jubilee can establish itself as a dominant player in country, broadening its commodity exposure, achieving early revenues and setting itself up for significant operational and financial growth long into the future.

“As we recently announced, we have plans to roll out a global metals processing strategy during 2022, leveraging our unique South African and Zambian intellectual property across other jurisdictions and continents.

“With our global metals processing strategy in mind, and with a very healthy balance sheet, we are confident that any future bank and structured funding that may be required to grow your company can be secured on substantially better terms.”

At 1156 GMT, shares in Jubilee Metals Group were up 4.37% at 16.28p.