BRUSSELS, April 1 Nyrstar, the world's
largest zinc smelting company, said on Tuesday it had agreed a
loan deal with struggling Finnish miner Talvivaara in
return for zinc ore.
Nyrstar said in a statement it would provide a loan of up to
20 million euros ($27.6 million) in several tranches, each
advance linked to a delivery of zinc in concentrate from
The new deal is structured to ensure Nyrstar continues to
receive zinc while not increasing its net financial exposure to
Talvivaara, Nyrstar said
Hurt by falling nickel prices and repeated production
disruptions, Talvivaara sought a court-led reorganisation in
November as it ran low on funds. It won court approval in
December to renegotiate its debt, allowing it to continue mining
and avoid the immediate risk of bankruptcy.
Nyrstar, Talvivaara's top creditor after paying 232 million
euros in advance for zinc deliveries, said it continued to work
with the Finnish firm along with others to find a potential
investor or investors to help cover its funding gap.
If Talvivaara found a solution, Nyrstar said it would offer
Talvivaara a "streaming holiday" -- exempting it for a time from
delivering up to 80,000 tonnes from its initial supply
In the event of such a streaming holiday, Nyrstar would
still purchase zinc ore from Talvivaara. It would also end the
Nyrstar agreed in 2010 to acquire 1.25 million tonnes of
zinc in concentrate from Talvivaara for a price of $335 million,
with possible supplementary payments if the zinc price rose.
Nyrstar also said it would immediately be receiving about
10,000 tonnes of zinc in concentrate under its initial zinc
($1 = 0.7256 Euros)
(Reporting By Philip Blenkinsop; editing by Robert-Jan