Unicorn Mineral Resources (LSE:UMR) has completed full drawdown of a £1.25m unsecured loan facility provided by Electro Automation (Group), a company controlled by Unicorn's chairman, Paddy Doherty.
The London-listed miner said the facility, first announced on 17 August, will fund working capital as it progresses the acquisition of the Klein Aub Copper Mine in Namibia.
Proceeds will cover completion of the acquisition, initial development and preparatory work at the site, establishment of an operational presence in Namibia, and technical and metallurgical studies, alongside general working capital for its Namibian and Irish operations.
The loan carries no security over Unicorn's assets.
The drawdown follows the recent signing of acquisition documentation for Klein Aub, which the company describes as its principal development opportunity as it shifts from exploration towards becoming an operating mining company in Southern Africa.
"We are increasingly focused on transitioning Unicorn towards becoming an operating mining company, and Klein Aub represents a significant opportunity to establish a substantial revenue producing copper project in Namibia," said John O'Connor, Unicorn's chief financial officer.
Klein Aub comprises historical mine workings, mineralised material and associated tailings, which Unicorn intends to evaluate and develop into a viable copper mining and processing operation.
O'Connor said the company would provide further updates as it advances the acquisition and begins its development programme at the site.
News Intelligence what this means for the company
Unicorn has drawn the full £1.25m unsecured loan from chairman Paddy Doherty's Electro Automation (Group) to fund the Klein Aub copper mine acquisition in Namibia, following signature of the acquisition documentation. The facility carries 10% per annum interest and matures one year after first drawdown, with no security over company assets—a related-party funding structure that shifts Klein Aub from announced deal to funded development phase, but leaves execution risk and repayment capacity unresolved.
The drawdown confirms Unicorn's commitment to transition from exploration to operating miner, but the one-year maturity and unsecured nature of chairman-backed funding mean the company must either generate cash from Klein Aub development, refinance, or raise equity within 12 months to repay £1.375m (principal plus 10% interest and 3% fee). Success hinges on execution at a low-grade copper project (0.26% head grade) using a glycine heap-leach process—both unproven at scale for this asset.
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