MC Mining Limited has secured up to US$16 million in capital support from its controlling shareholder, Kinetic Development Group Limited, through an unsecured bridge loan and a two-tranche share subscription agreement.

The transaction provides MC Mining with immediate access to working capital to fund business operations, ongoing corporate requirements, and the continued development of its asset portfolio.

The financing package comprises an unsecured bridge loan of US$8,000,000, which carries an interest rate equal to the Reserve Bank of Australia medium business loan rate plus a 3.00% annual margin, compounded monthly. The bridge loan must be repaid within three months of drawdown, or earlier if the first closing of the share subscription occurs.

To fund the longer-term capital needs of the business, Kinetic Development Group has agreed to subscribe for 76,591,672 new fully paid ordinary shares in MC Mining at an issue price of US$0.2089 per share, raising an aggregate US$16 million across two equal tranches.

The first tranche of US$8 million will be satisfied and discharged in full by setting off the outstanding principal amount of the bridge loan, meaning no cash changes hands at the first closing. Accrued interest on the bridge loan remains payable in cash. The second tranche of US$8 million will be paid in cash at the second closing.

Drawdown of the bridge loan is conditional upon receiving voting intention statements from shareholders holding at least 25% of the company's issued share capital and completing corporate formalities within five business days.

Completion of the share subscription requires the approval of non-associated shareholders under the Australian Corporations Act, ASX listing rules, and JSE requirements at an upcoming general meeting.

In addition, the second tranche closing is conditionally dependent upon the Makhado Project having commenced production, alongside satisfaction with operating performance, project progress, and updated cash flow forecasts.

MC Mining holds five other coal assets in South Africa, including Uitkomst Colliery, Vele Colliery, Chapudi, Generaal, and Mopane.

Read the full announcement: MCM secures bridge funding and further capital support