Gensource Announces Addition of Societe Generale as Joint Mandated Lead Arranger for Senior Debt Financing of the Tugaske Project
Gensource Announces Addition of Societe Generale as Joint Mandated Lead
Arranger for Senior Debt Financing of the Tugaske Project
SASKATOON, Saskatchewan--(BUSINESS WIRE)--May 19, 2020--Gensource Potash
Corporation (“Gensource” or the “Company”) (TSX-V: GSP), a Saskatoon-based fertilizer
development company focused on sustainable potash production, announces today that it,
together with mandated lead arranger and coordinating bank KfW IPEX-Bank GmbH (“KfW
IPEX-Bank”), welcomes Societe Generale to the bank consortium. Societe Generale has been
appointed as joint lead arranger alongside KfW IPEX-Bank for the senior debt facility (“Debt
Facility” or “Facility”) for the Tugaske Project (“Tugaske” or “Project”) finance package.
Gensource is very pleased to formally add Societe Generale to the Facility team. Societe
Generale is a French multinational investment bank and financial services company
headquartered in Paris, France. KfW IPEX-Bank was mandated as lead arranger and coordinator
in October 2019 (see Gensource news release dated 18 Oct 2019) to structure the Debt Facility
and manage the syndication. KfW IPEX-Bank is a leading specialist financier of international
structured project and export finance, headquartered in Frankfurt, Germany. It is an affiliate of
German bank KfW Bankengruppe.
Mike Ferguson, President & CEO of Gensource, commented “We are extremely pleased that
Societe Generale wanted to be part of the Tugaske opportunity and we are thrilled to add them as
a joint mandated lead arranger with KfW IPEX-Bank. These two lenders are major players in the
greenfield project finance in mining and agriculture sectors and have demonstrated success in
financing fertilizer projects all over the world. If Aesop is correct when he said that “A man is
known by the company he keeps”, then Gensource is very proud to be in the company of two
such strong and well-respected international financial institutions as KfW IPEX-Bank and
Societe Generale. The addition of Societe Generale as joint lead arranger is another significant
step towards completing the financing that will move Tugaske to construction this year.”
Lenaig Trenaux, Regional Head of Metals and Mining, Americas of Societe Generale added “As
a leading bank with a global footprint in the mining industry and a presence in Canada we are
very pleased to have the opportunity to take a lead role in the financing of this innovative
fertilizer mining project alongside KfW IPEX-Bank.”
“We are pleased to have found with Societe Generale a partner bank that will take part in the
ongoing work on this important and sustainable fertilizer mining project which will not only
benefit the Canadian economy but also support our German suppliers, important clients of KfW
IPEX-Bank, in these turbulent times.” said Michael Nosbüsch, Global Head of Metals and
Mining at KfW IPEX-Bank.
Agreements have been executed by the parties, indicating that:
KfW IPEX-Bank and Societe Generale will act as Joint Mandated Lead Arrangers to
arrange the Debt Facility for the Tugaske Project.
A total Debt Facility of approximately USD 180 million is agreed. Each of the Mandated
Lead Arrangers will support the project with a significant take and hold commitment.
KfW IPEX-Bank and Societe Generale will complete due diligence work together,
including the in-depth review of technical, environmental, social, market and financial
aspects of the project.
A significant portion of the Facility is to have Export Credit Agency (ECA) coverage to
reduce both lender risks and the Project’s interest costs; structuring of the ECA
component will be managed by KfW IPEX-Bank.
In its roles as deal coordinator and bookrunner KfW IPEX-Bank will continue its work to
form a supportive and reliable lender consortium for the Debt Facility.
A key aspect of the agreement indicates that a significant portion of the overall debt facility is to
be provided by these two institutions. Gensource sees this as a tremendous vote of confidence in
the Tugaske Project.
Final definitive terms for the Debt Facility will be developed and agreed following the due
diligence process. Subsequently, Gensource and the Mandated Lead Arrangers will prepare and
execute a definitive facility and security documentation at financial close. The ultimate financing
of the Project is conditional upon the successful completion of the detailed due diligence process.
“Climate change and food security issues make it urgently necessary to forge tighter links
between economic and ecological matters in the interests of sustainable development. We feel
fortunate to have KfW IPEX-Bank and Societe Generale as like-minded partners who share the
same vision and commitment toward promoting ecologically sound, socially just, and
economically robust projects,” added Mike Ferguson. "We envision the Tugaske project as an
innovation in potash production that can help safeguard both the livelihoods and quality of life
for coming generations.”
About Gensource
Gensource Potash is a fertilizer development company based in Saskatoon, Saskatchewan and is
on track to become the next fertilizer production company in that province. With a small scale
and environmentally leading approach to potash production, Gensource believes its technical and
business model will be the future of the industry. Gensource operates under a business plan that
has two key components: (1) vertical integration with the market to ensure that all production
capacity built is directed, and pre-sold, to a specific market, eliminating market-side risk; and (2)
technical innovation which will allow for a small and economic potash production facility, that
demonstrates environmental leadership within the industry, producing no salt tailings, therefore
eliminating decommissioning risk, and requiring no surface brine ponds, thereby removing the
single largest and negative environmental aspect of potash mining.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined
in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Caution Regarding Forward-Looking Statements
This news release may contain forward looking information and Gensource cautions readers
that forward- looking information is based on certain assumptions and risk factors that could
cause actual results to differ materially from the expectations of Gensource included in this news
release. This news release includes certain "forward-looking statements”, which often, but not
always, can be identified by the use of words such as "believes", "anticipates", "expects",
"estimates", "may", "could", "would", "will", or "plan". These statements are based on
information currently available to Gensource and Gensource provides no assurance that actual
results will meet management's expectations. Forward-looking statements include estimates and
statements with respect to Gensource’s future plans, objectives or goals, to the effect that
Gensource or management expects a stated condition or result to occur, including the ability to
finance the Tugaske Project or other projects, the establishment of vertical integration
partnerships and the sourcing of end use potash purchasers. Since forward-looking statements
are based on assumptions and address future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results relating to Gensource’s financial
condition and prospects, the ability to finance the Tugaske Project or other projects on terms
which are economic or at all, the ability to establish viable vertical integration partnerships and
the sourcing of end use potash purchasers could differ materially from those currently
anticipated in such statements for many reasons such as: failure to finance the Tugaske Project
or other projects on terms which are economic or at all; failure to settle a definitive joint venture
agreement with a party and advance and finance the project; changes in general economic
conditions and conditions in the financial markets; the ability to find and source off-take
agreements; changes in demand and prices for potash; litigation, legislative, environmental and
other judicial, regulatory, political and competitive developments; technological and operational
difficulties encountered in connection with Gensource’s activities; and other matters discussed
in this news release and in filings made with securities regulators. This list is not exhaustive of
the factors that may affect any of Gensource’s forward-looking statements. These and other
factors should be considered carefully and readers should not place undue reliance on
Gensource’s forward-looking statements. Gensource does not undertake to update any forward-
looking statement that may be made from time to time by Gensource or on its behalf, except in
accordance with applicable securities laws.
Contacts
Gensource Potash Corporation:
Mike Ferguson, President and CEO
Telephone: (306) 974-6414
Email: [email protected]