AMAK announces use of IPO proceeds

Logo of Al Masane Al Kobra Mining Co. (AMAK)

Al Masane Al Kobra Mining Co. (AMAK) announced today, April 6, the use of proceeds from its initial public offering (IPO) of new shares, which took place from March 9-11.

AMAK received gross proceeds of SAR 609.3 million and net proceeds of SAR 594.8 million, with IPO-related company expenses of SAR 14.5 million, it said in a statement to Tadawul.

The IPO proceeds were received on March 31, 2022.

Net offering proceeds will be used for Moyeath orebody development project, amounting to SAR 296.2 million. The proceeds will also go towards exploration activities expenditure, amounting to SAR 121.7 million, and general purpose expenses of SAR 176.7 million.

For Moyeath orebody project, the actual disbursements were around SAR 30 million as of Q1 2022.

Meanwhile, under general purpose expenses, AMAK made an early settlement of an outstanding medium term Tawarroq loan of SAR 29.2 million, on March 31, 2022, leaving the general purposes IPO proceeds balance at SAR 147.5.

The medium-term Tawarroq loan agreement was obtained on Dec. 19, 2019, to finance the capital expenditure related to the company’s new Guyan gold mine.

The financing amounted to SAR 50 million, repayable in 12 equal quarterly instalments, with the original maturity date of Dec. 31, 2023.

By settling this loan, AMAK will have paid off all its commercial loans, leaving it with only loans provided by the Saudi Industrial Development Fund, the statement noted.

The company will announce any significant developments in this regard, it added.