* Funds earmarked for phosphate, gold and aluminium
* Date for shareholder vote on rights issue to be announced
* HSBC Saudi Arabia appointed as advisor -banking sources
(Adds adviser, context)
DUBAI, May 15 Saudi Arabian Mining Co
will seek shareholder approval for a 5.6 billion riyal ($1.49
billion) rights issue to help to fund its expansion plans, the
company said on Thursday.
The company, better known as Ma'aden, intends to use the
money to expand its phosphate and gold operations, as well as
increase funding for its aluminium business, it said in a bourse
filing, adding that a date for the shareholder vote would be
Ma'aden is in the middle of an extensive expansion through
its Waad al-Shamal project in the north of the kingdom. The $9
billion scheme will include a phosphate mine, several major
processing facilities, smaller downstream factories and a
The project will have production capacity of 16 million
tonnes a year of phosphate concentrate, sulphuric acid,
phosphoric acid, as well as plants to produce calcium
monophosphate and calcium diphosphate, Ma'aden has said.
Phosphate production is expected to start in late 2016.
Banking sources said that HSBC's Saudi Arabian arm
will advise on the rights issue. Its mandate has been in place
for some but it hasn't always clear whether the capital increase
would go ahead, two banking sources in the kingdom said.
The mandate was part of HSBC's role in arranging wider
financing for the Waad al-Shamal project, one source said.
Ma'aden could not be immediately reached for comment on the
advisory mandate and HSBC declined to comment.
Ma'aden has already secured a $4.2 billion loan package from
commercial banks and export credit agencies to fund the
construction at Waad al-Shamal, which loosely translates as
Two Saudi government funds - the Public Investment Fund and
Saudi Industrial Development Fund - are also providing funds for
($1 = 3.7505 Saudi Riyals)
(Reporting by David French; Editing by David Goodman)