Marimaca Copper (TSX:MARI) - $68M Buys Board Seat at Advanced Developer

Interview with Hayden Locke, President & CEO of Marimaca Copper

Our previous interview: https://www.cruxinvestor.com/posts/marimaca-copper-tsxvmari-drilling-to-further-expand-resources-5641

Recording date: 16th July 2024

Marimaca Copper, developer of the Marimaca Oxide project in Northern Chile, has announced a significant financing deal that positions the company for accelerated growth. Assore International Holdings, an international arm of South African mining business, has agreed to acquire a majority of Tembo Capital's ownership stake and invest additional capital at a 15% premium to the current share price. The C$68 Million strategic investment not only strengthens Marimaca's financial position but also brings on board a strategic partner with deep mining expertise.

The deal, priced at $4.50 per share, follows a pattern of premium investments in Marimaca, with Mitsubishi previously investing at $4.31 per share. This trend of above-market investments signals strong confidence in the project's potential and the scarcity of high-quality copper development opportunities in the current market.

Hayden Locke, President and CEO of Marimaca Copper, emphasized the strategic importance of this funding: "We're very excited that Assore is on board. They've got a deep mining heritage, very strong financially. They understand what we're trying to achieve, and they're very keen to back us for the next phase."

The new capital will be deployed across several critical areas: detailed design and engineering, crucial for minimizing the risk of cost overruns during construction, advancement of the debt financing process, completion of any remaining technical work, expansion of exploration activities, fully funded under the new agreement, and building a robust owner's team with significant project development experience.

Marimaca's management has identified key risk areas, including geotechnical challenges, labor productivity, and execution risk. The new funding allows the company to address these concerns through increased engineering definition and the assembly of an experienced project team.
The investment comes at a time of growing demand for copper, driven by the global energy transition and electrification trends. With few high-quality copper projects in the development pipeline, Marimaca's advanced-stage project in a stable mining jurisdiction positions the company favorably in the market.

For investors, this deal presents several potential advantages:

• Reduced financing risk, with the company now funded through to Final Investment Decision (FID),
• Validation of the project's value through premium-priced investments from industry players,
• Potential for value creation through both project development and exploration activities, and
• Exposure to the bullish copper market outlook.

Locke summarized the company's focus moving forward: "We've got to deliver the DFS, we've got to deliver the financing, we've got to deliver the detail design and engineering, we've got to put together the management team, and then we've got to go through the process of building it."

As Marimaca Copper advances its project towards production and expands its exploration efforts, it presents an intriguing opportunity for investors seeking exposure to the copper sector. The company's ability to attract premium investments, coupled with its strategic approach to project de-risking and value creation, positions it as a noteworthy player in the copper development space.

Learn more: https://cruxinvestor.com/companies/marimaca-copper

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