Three agreements net financing for Stratmin

Three financing agreements worth about $26.2 million in total have been struck by graphite producer Stratmin (ME) and its subsidiary Stratmin Graphite. The agreements have been reached with Mircal, a wholly owned subsidiary of the French group Imetal, the Canadian Imperial Bank of Commerce and le Credit Industriel Desjardins.

Imetal has invested $5 million in return for B shares representing 25% of the votes and a participation of 25% in the benefits and surplus of Stratmin Graphite if the after-tax profits are less than $3 million, 7.5% in the profits of $3-4 million, 5% in the profits of $4-5 million, and no participation in all profits above $5 million.

The bank has agreed to lend $20 million, the transaction consisting of an $18-million long-term loan and credit margin of $2 million. Desjardins will lend about $1.2 million to finance the conditional sale contracts for mobile mining equipment.

Stratmin says the new funding has allowed reimbursement of an outstanding loan of $14.5 million to Banque Nationale.

In addition to its investment, Imetal has agreed to purchase a minimum 5,000 tonnes of graphite concentrate during the next two years and a minimum of 5,000 tonnes in each of the three subsequent years.

Stratmin, Imetal and Asbury Graphite Mills have agreed to make Imetal’s wholly owned subsidiary, Damrec, the exclusive distributor on the European continent for graphite concentrate produced by Stratmin.

Stratmin mines a graphite deposit situated about 100 miles north of Montreal. A transaction announced earlier involving Stratmin and an international distributor for its graphite concentrate was not concluded.