Gindalbie Metals Limited (ASX:GBG)
and joint venture partner Ansteel have agreed to a restructure of the Karara project in Western Australia.
Gindalbie says its stake in Karara Mining may be reduced from 50 per cent to a minimum of 47.84 per cent as Ansteel moves to provide bridging loan finance to KML to fund any cash shortfalls over the next 12 months.
The move is conditional on Foreign Investment Review Board approval, Chinese regulatory approvals and bank consent.
Gindalbie says it will work with Ansteel to help KML secure a new longer-term working capital facility for KML from China Development Bank.
The funding mechanism means Gindalbie no longer needs to raise further equity capital to support KML, leaving the company with more than $35 million in cash and no debt.
Gindalbie Metals posted an $18.8 million loss for the first half of the current financial year.