Polymet Mining Corp (PLM)

[freshfrom/pol/]

Masabi Daily News

Follow up article on Polymet:
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PolyMet Mining Corp. said Tuesday it plans to clear debt with Swiss-based mining conglomerate Glencore through offering new shares of the company to current stockholders.

The preliminary rights offering is expected to give stockholders the option to buy additional shares of PolyMet at discounted rates. PolyMet would then clear debt owed to Glencore throughout the lengthy environmental review and permitting process on what would be Minnesota’s first-ever copper-nickel mine. PolyMet said the offering will raise about $265 million through an estimated 322 million shares.

As part of the announcement, Glencore and PolyMet entered into a purchase agreement for all the remaining new shares not exercised by other stockholders, fully guaranteeing the money will be raised.

As a result, Glencore could potentially own more than 50 percent of PolyMet if other shareholders pass on the opportunity to further buy into the company. If all the shareholders exercise their options, the ownership breakdown will remain the same, keeping Glencore at about 30 percent.

PolyMet said the rights offering and purchase agreement are not an acquisition or a step toward an outright acquisition by Glencore.

“This is another indication of Glencore’s continuing commitment to this project and to Minnesota,” PolyMet spokesperson Bruce Richardson told the Mesabi Daily News during a phone interview Tuesday. “They’ve been financially involved with us and been instrumental in providing the funding to allow this project to become fully permitted, but they’ve also provided a tremendous amount of technical help and expertise as one of the world’s largest mining companies”

The agreement will now be reviewed by the Toronto Stock Exchange and New York Stock Exchange, before the additional shares are listed.

The TSX and NYSE have 30 days to review the filings until they must issue a final rights prospectus with details on the date of record — when a shareholder must own a certain amount of stock by to participate in the discounted sale — and the discounted sale price.

PolyMet received its final state permits from the Minnesota Department of Natural Resources in November 2018 and from the state Pollution Control Agency in December 2018.

The Army Corps of Engineers signed the final federal permit in March, ending more than a decade of reviews and public comment periods.

The permits, as well as a federal land exchange, have faced tough scrutiny and several lawsuits and appeals by environmental groups in the state.

Still, company officials have said they hope to raise the additional funds needed for the NorthMet project and break ground on it this year.