Specialist graphite and graphene company Tirupati Graphite has clarified that it will not be taking on any external debt with its A$12.5-million acquisition from Battery Minerals (BM) of 100% of the issued share capital of BM Mozambique subsidiary Suni Resources.

Tirupati, in August 2021, entered into an agreement with BM to acquire the entire issued share capital of Suni Resources, inclusive of all related intellectual property relating to the Montepuez project and Balama Central project.

As such, Tirupati will be assigned the shareholder loans owed by Suni Resources to certain BM group companies amounting to A$29-million.

However, Tirupati reports that it received a number of questions from investors regarding the A$29-million-worth of shareholder loans that will be assigned to Tirupati by BM group companies.

In this regard, Tirupati reports that it will not have any obligation regarding the repayment of, or the payment of interest on, any third-party debt upon completion of the acquisition of Suni Resources.

Tirupati CEO Shishir Poddar says the company feels duty bound to correct the misconception that Tirupati is acquiring any external debt through the acquisition of Suni Resources. “The agreed consideration is the only cost to Tirupati for acquiring these transformational, ready-to-construct projects with globally significant resources.”

In addition, Tirupati clarifies that the debt assigned to it by BM group companies will, on completion of the acquisition, become an intra-group debt within the enlarged Tirupati group owed by Suni Resources to Tirupati.

Tirupati further confirms that arrangements have been progressed for the provision of the bank guarantee to be completed which will permit for the last steps towards closing of the acquisition of Suni Resources to be progressed.

Without taking on any debt, he says, Tirupati will acquire the Balama Central and Montepeuz projects in Mozambique, which are both fully licensed for construction to more than 150 000 t/y of flake graphite production capacity and which have already benefited from significant investment to this date.