Horizon Copper Expands Financial Capacity with New Credit Facility

Author: Henry Turner Updated: 09-10-2024 04:24 PM

Horizon Copper Expands Financial Capacity with New Credit Facility

Horizon Copper Corp. (TSX-V: HCU) (OTCQX: HNCUF) is excited to reveal its latest financial move aimed at bolstering growth and operational flexibility. They have secured a revolving credit agreement with prominent banking institutions, National Bank of Canada and The Bank of Nova Scotia, which allows the company to tap into a maximum borrowing capacity of up to US$30 million. Furthermore, the agreement includes an additional unsecured accordion facility of US$20 million, bringing the total availability to US$50 million.

Details of the Credit Agreement

The Revolving Loan, structured to lapse in four years, matures in September 2028, subject to approval for any extensions by the lending parties. Horizon intends to utilize the funds primarily to support future asset acquisitions and finance ongoing developmental activities related to the Hod Maden project, along with general corporate needs. The revolving facility’s interest rates are linked to SOFR, varying between 2.50%–3.75%, depending on the company's leverage performance.

Importance of the Leverage Ratio

Under the terms set forth in the credit agreement, Horizon Copper must maintain a leverage ratio below 4.0x. This stipulation excludes any existing debts associated with Sandstorm Gold Ltd., a strategic growth partner for Horizon. This cap on leverage underscores the company's commitment to maintaining robust financial health while pursuing its aggressive growth agenda.

Executive Insights

Erfan Kazemi, Horizon's President & CEO, enthusiastically commented on the significance of this new financial tool: "We are pleased to expand our financing capabilities with this new Revolving Loan. This credit facility, combined with our existing cash reserves, enhances our financial flexibility as we continue to pursue growth opportunities and invest in developing the Hod Maden project." This sentiment illustrates the management's proactive approach in securing favorable financing conditions to capitalize on market opportunities.

Horizon Copper's Asset Portfolio

As a premier player in the copper sector, Horizon Copper boasts an extensive and varied portfolio that includes a notable 1.66% net profits interest in the Antamina copper mine. Moreover, the company has substantial exposure to the Oyu Tolgoi copper mine through a 24% equity ownership in Entrée Resources Ltd. and holds a 30% interest in the promising copper-gold Hod Maden project. These diverse core assets position Horizon for significant growth within the burgeoning copper industry.

Future Growth Plans

Looking ahead, Horizon Copper is determined to further expand its asset base, focusing intently on new copper projects. The strategic use of their credit facility will play an integral role as they navigate the evolving landscape of the mining sector and respond to rising global demand for copper.

Conclusion

In conclusion, Horizon Copper's recent achievement heralds a pivotal moment in its journey towards growth and expansion. The additional financial flexibility afforded by this new US$30 million revolving credit facility, along with the strategic plans in place, signifies a robust commitment to advancing their operations and promising projects like Hod Maden. As the company embarks on this new chapter, stakeholders can expect exciting developments that enhance value and opportunity in the copper market.

Frequently Asked Questions

What is Horizon Copper's recent financial announcement?

Horizon Copper announced a new revolving credit facility of US$30 million, with an additional US$20 million accordion feature.

What will Horizon Copper use the funds from the credit facility for?

The funds will primarily be directed towards asset acquisitions, development activities for the Hod Maden project, and general corporate purposes.

What are the key terms of the credit agreement?

The revolving loan matures in four years and has an interest rate that is variable based on SOFR, alongside a leverage ratio requirement of less than 4.0x.

Who is the President & CEO of Horizon Copper?

Erfan Kazemi is the President & CEO of Horizon Copper Corp.

What are Horizon Copper's key assets?

Key assets include a 1.66% net profits interest in the Antamina copper mine and a 30% interest in the Hod Maden project, among others.

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Horizon Copper Expands Financial Capacity with New Credit Facility