UK fertilizers developer Sirius Minerals targets $3.8bn fundraising

Sirius Minerals hopes to raise $3.8bn through a financing package including a share placement, bond issue and new credit facility, as it prepares for the next phase of its UK fertilizers mining project.

The UK-headquartered fertilizer start-up has worked with bank JP Morgan, which is underwriting a significant portion of the funding package.

The investment bank is to provide the entirety of a $2.5bn revolving credit facility – although it is likely to syndicate out some of that debt to other banks – and is underwriting a new $400m share placing, launched with a price of 15-18 pence/share.

Sirius will also attempt to raise $400m from the sale of convertible bonds, as well as $500m of senior debt.

JP Morgan is also underwriting the convertible bond sales.

Sirius' CEO Chris Fraser says the package "will enable Sirius Minerals to complete development" of the Woodsmith mine in northern England.

"The funding package will bring together equity, convertible bonds, high yield debt, and a $2.5bn revolving credit facility in a multi-stage, flexible structure," he added.

Polyhalite is a multi-nutrient fertilizer found more than 1,200m below the Earth’s surface, under the North Sea along England’s northeast coast — a seam of nutrient-rich rock Sirius intends to extract from its Woodsmith mine site near Whitby.

Sirius says it is on course to strike the first seam of polyhalite in 2021, and be producing up to 10m tonnes/year of Poly4 by 2024.

Poly4 includes 14% potassium, 19.5% sulphur, 6% magnesium, and 17% calcium.