Bowen Coking Coal gets investors over the line for $70m raise

Bowen Coking Coal will announce details of its equity raising on Friday. Picture: Bloomberg

Bowen Coking Coal is understood to have secured the $70m it was searching for after doubts started to emerge in recent days that could raise the capital.

The understanding is that existing shareholders and lenders have tipped in funds for the deal that will be announced on Friday.

Hurting Bowen has been challenges with its underperforming Bluff Mine in Queensland but also having an impact has been state coal mining royalties, which cost the group about $60m last year.

For the year to June 30, Bowen Coking Coal lost $68.8m.

Shares had been suspended from trading for at least a month while it went in search of additional finances.

Shaw and Partners and Morgans have been working on the deal for the loss-making company, and it said on October 25 it had secured $6.15m from shareholders for its entitlement offer, and the underwriters had offered $41.5m.

Bowen Coking Coal earlier said it had received about $40.5m in commitments from major shareholders Crocodile Capital 1 Global Focus Fund, Crocodile Capital Offshore Fund, Crocodile Capital Partners GmbH as well as new investors Square Resources or its nominee and Taurus Mining Finance Fund Number 2, which is partially owned by Regal Funds and is the group’s debt provider.

Regal Funds owns half of secured creditor Taurus, which is owed $60m worth of loans by Bowen Coking Coal.

Also lending money to Bowen Coking Coal is New Hope Corporation.

Both lenders have agreed to extend the duration of the loans and for a material reduction in interest and royalty costs in return for equity and on the condition of a $25m equity raise and no insolvency event.