Core West Advisory Services Group
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Confidential Information Memorandum · 2026
A Senior Secured Private Debt Term Loan structured to fund the final pre-listing capitalisation and strategic acquisitions of Magni Resources Limited ahead of its November 2026 JSE Main Board listing.
Covering Letter
Dear Reader,
Core West Advisory Services Group is pleased to present this comprehensive Capital Raising Structure detailing the $70 000 000.00 (Seventy Million US Dollars) Pre-IPO Bridge Facility for Magni Resources Limited ("MRL").
This document outlines a highly strategic, event-driven private credit opportunity. MRL is currently in the final stages of a landmark listing on the Main Board of the Johannesburg Stock Exchange (JSE), formally targeted for November 2026. To maximize the Day 1 Enterprise Value (EV) of the listed entity, this bridge facility has been strategically upsized to $70 million.
The operational and financial merits of this transaction are substantial. The capital is primarily allocated to fund the acquisition of a 50% plus 1 share controlling interest in the Makunyula Anthracite Mine. This transformative buyout brings a 200 MT near-production asset out of business rescue and into the MRL portfolio, instantly transitioning the group into a cash-generative enterprise ahead of the IPO. Concurrently, the funds will finalize all requisite SAMREC-compliant technical reports and accelerate critical early-works project development at the Mpaka and Grootvlei assets.
Structurally, this transaction is engineered to offer institutional-grade risk mitigation. The exit mechanism is entirely decoupled from inherent mining operational risks. Instead, repayment is definitively anchored by a committed $300 000 000.00 (Three Hundred Million US Dollar) Share Subscription Facility Agreement provided by Global Emerging Markets (GEM).
To ensure absolute capital protection for the incoming funder while maintaining strict compliance with South African Reserve Bank (SARB) exchange controls and JSE regulations, we have architected an institutional "First-Pay Obligation". This robust legal framework mandates that upon MRL's compliant receipt of GEM equity funds, the directors are unconditionally bound by a formal Deed of Undertaking to settle the debt facility as their absolute first priority, prior to any operational disbursements.
Structural Assurance
"With a liquidity coverage ratio exceeding 4x and a comprehensive security package that includes a hard-asset backstop, share pledges, and corporate guarantees, this facility presents a highly secure, short-duration investment with exceptional downside protection."
We invite you to review the enclosed confidential information memorandum and look forward to discussing this transaction in detail.
Sincerely,
Core West Advisory Services Group (Pty) Ltd
Confidential Information Memorandum — $70 000 000.00 (Seventy Million US Dollars) Pre-IPO Bridge Facility for Magni Resources Limited
For the purposes of absolute clarity in this and all subsequent binding agreements, the following terms shall bear the meanings assigned to them below.
| Term | Definition |
|---|---|
| "the Act" or "Companies Act" | the South African Companies Act, 2008 (No. 78 of 2008), as amended from time to time; |
| "Asset for Shares Agreement" | the agreement between Magni Resources and Magni Investments for the 100% acquisition of Lurco Coal Eswatini in terms of a group restructure ahead of the intended listing as detailed in Annexure 17; |
| "AcaciaCap Advisors" or "Sponsor" | AcaciaCap Advisors Proprietary Limited, (Registration number 2006/033725/07), a private company duly incorporated in accordance with the laws of South Africa having its registered address at 20 Stirrup Lane, Woodmead Office Park, Woodmead, Johannesburg, and the Sponsor to Magni Resources; |
| "associate" (individual) | 1. that individual's immediate family; and/or 2. the trustees, acting as such, of any trust of which the individual or any of the individual's immediate family is a beneficiary or discretionary subject, including trustees of a trust without nominated beneficiaries, but who have been provided with a letter of wishes or similar document or other instruction, including a verbal instruction, naming desired beneficiaries (other than a trust that is either an occupational pension scheme, or an employees' share scheme that does not, in either case, have the effect of conferring benefits on the individual or the individual's family); and/or 3. any trust, in which the individual and/or his family referred to in 1 above, individually or taken together have the ability to control 35% of the votes of the trustees or to appoint 35% the trustees, or to appoint or change 35% of the beneficiaries of the trust. Without derogating from the above, and for the purposes of this definition, the term trust may also be replaced with any other vehicle or arrangement set up for similar purposes to that of a trust; and/or 4. any company in whose equity securities the individual or any person or trust contemplated in 1 or 2 above, taken together, are directly or indirectly beneficially interested, or have a conditional, contingent or future entitlement to become beneficially interested, and that the individual or any person or trust contemplated in 1 or 2 above are, or would on the fulfilment of the condition or the occurrence of the contingency be, able: (a) to exercise or control the exercise of 35% or more of the votes able to be cast at general meetings on all, or substantially all, matters; or (b) to appoint or remove directors holding 35% or more of the voting rights at board of directors' meetings on all, or substantially all, matters; or (c) to exercise or control the exercise of 35% or more of the votes able to be cast at a board of directors' meeting on all, or substantially all, matters; and/or 5. any close corporation in which the individual and/or any member(s), taken together, of the individual's family are beneficially interested in 35% or more of the members' interest and/or are able to exercise or control the exercise of 35% or more of the votes able to be cast at members' meetings on all, or substantially all, matters; and/or 6. any associate as defined below with reference to a company of the Company referred to in 4 above. For the purpose of 4(a), (b) and (c) above, where more than one director of the same listed company is directly or indirectly beneficially interested in the equity securities of another company, then the interests of those directors and their associates will be aggregated when determining whether such a company is an associate of any one director of such listed company. |
| "associate" (company) | 1. any other company that is its subsidiary, holding company or subsidiary of its holding company; and/or 2. any company whose directors are accustomed to act in accordance with the Company's directions or instructions; and/or 3. any company in the capital of which the Company, and any other company under 1 or 2 taken together, is, or would on the fulfilment of a condition or the occurrence of a contingency be, interested in the manner described in 4 above; and/or 4. any trust that the Company and any other company under 1 and 2 above, individually or taken together, have the ability to control 35% of the votes of the trustees or to appoint 35% of the trustees, or to appoint or change 35% of the beneficiaries of the trust. Without derogating from the above, and for the purposes of this definition, the term trust may also be replaced with any other vehicle or arrangement set up for similar purposes to that of a trust. |
| "Aubrey Chauke" | Aubrey Chauke, the Chief Executive Officer of Magni Resources, with a business address at 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196; |
| "auditors" | Mazars (Practice Number 900222), which audit firm is on the list of JSE accredited auditors at the Last Practicable Date and which entity has been appointed as the auditor and independent reporting accountant to Magni Resources, further details of which entity are included in the Corporate Information section of this Prospectus; |
| "Basil Mashabane" | Basil Kgaugelo Mashabane, an Independent Non-Executive Director and Chairman of the Nominations and Remunerations Committee as well as the Investment Committee of Magni Resources of 160 Jan Smuts Avenue, Rosebank, 2046, Johannesburg, 2196; |
| "BBBEE Act" | The Broad-Based Black Economic Empowerment Act, 2003 (Act 53 of 2003), as amended; |
| "BEE" or "BBBEE" | the economic empowerment of all black people, including women, workers, youth, people with disabilities and people living in rural areas, through diverse but integrated socio-economic strategies as defined in the BBBEE Act; |
| "Board of directors" or "the Board" | the present board of directors of Magni Resources at the Last Practicable Date, further details of whom appear in paragraph 1.2 of this Prospectus; |
| "broker" or "stockbroker" | any person registered as a "broking member (equities)" in terms of the Rules of the JSE made in accordance with the provisions of the FMA; |
| "business day" | any day other than a Saturday, Sunday or gazetted national public holiday in South Africa; |
| "CEO" | Aubrey Chauke; |
| "certificated shareholders" | holders of certificated Shares; |
| "certificated Shares" | issued ordinary Shares which have not been dematerialised, title to which is represented by share certificates or other physical documents of title; |
| "CIPC" or "the Commission" | the Companies and Intellectual Property Commission; |
| "common monetary area" | South Africa, the Republic of Namibia and the Kingdoms of Eswatini and Lesotho; |
| "Companies Regulations" or "Regulations" | the Companies Regulations, 2011 promulgated in Government Gazette No. 34239 in terms of section 223 of the Companies Act; |
Definitions and Interpretation — Continued
| Term | Definition |
|---|---|
| "Company Secretary" | Mrs Nadia Erasmus (Para legal), a private individual, having an address at 20 The Piazza, 1st Floor Melrose Arch, Johannesburg, 2196; |
| "competent person" or "Sugar Bush" | the independent competent person of the Company, being Sugar Bush Company (Pty) Limited (Registration number 2016/346088/07), represented by Karin van Deventer, a private company registered and incorporated in accordance with the laws of South Africa; |
| "Constitution" | the Constitution Of The Kingdom Of Swaziland Act, 2005; |
| "controlling shareholder" | the founder and controlling shareholder of Magni Resources before and after the Private Placing, being Magni Investment Holdings; |
| "CSDP" | a Central Securities Depository Participant, accepted as a participant in terms of the FMA, appointed by an individual shareholder for purposes of, and in regard to, the dematerialisation of documents of title for purposes of incorporation into Strate; |
| "dematerialise" | the process whereby certificated shares are converted into electronic format for purposes of Strate and are no longer evidenced by documents of title, and "dematerialised shares" will have a corresponding meaning; |
| "dematerialised shares" | Magni Resources shares which have been incorporated into the Strate system, title to which is no longer represented by share certificates or other physical documents of title; |
| "directors" | the directors of the Company whose details are set out in paragraph 1.2 and Annexure 12 to this Prospectus; |
| "documents of title" | share certificates, certified transfer deeds, balance receipts or any other documents of title acceptable to Magni Resources in respect of Shares; |
| "emigrant" | an emigrant from South Africa whose address is outside the common monetary area; |
| "ESE" | Eswatini Stock Exchange (formerly the Swaziland Stock Exchange); |
| "ESG" | Environmental, Social and Governance; |
| "Eswatini" or "Swaziland" | the Kingdom of Eswatini, formerly known as the Kingdom of Swaziland; |
| "Eswatini iNgwenyama Trust" | all land (including any existing concessions) in Eswatini, save privately held title-deed land, shall continue to vest in iNgwenyama in trust for the Swazi Nation as it vested on April 12, 1973, in terms of the Constitution, Chapter XII Land, Minerals, Water and Environment. Minerals are vested to iNgwenyama of Eswatini in trust for the Eswatini Nation. The Minerals Management Board advises iNgwenyama on the overall management of minerals and making of grants, leases or other dispositions conferring rights or interests in respect of minerals or mineral oils in Eswatini; |
| "Eswatini Mining and Minerals Act" | the Mines and Minerals Act, 2011 (Act No. 4 of 2011); |
| "Exchange Control Regulations" | the Exchange Control Regulations, promulgated in terms of Section 9 of the Currency and Exchanges Act, 1933 (Act 9 of 1933), as amended; |
| "extended family" | an individual's extended family determined by applying the family cross holdings test to the director and spouse (if applicable) in terms of the JSE Listings Requirements; |
| "FMA" | the Financial Markets Act, 2012 (Act 19 of 2012) as amended; |
| "Gladwin Mfolo" | Mekgwe Gladwin Mfolo, an Executive Manager– Projects and Technology of Magni Resources of 67 Beverly Hills Estate, Robert Bruce Road, Beverly, Sandton, 2191; |
| "Income Tax Act" | Income Tax Act (Act 58 of 1962), as amended; |
| "IFRS" | International Financial Reporting Standards, which comprise standards approved by the International Accounting Standards Board and Standing Interpretations Committee interpretations approved by the International Accounting Standards Committee, as amended from time to time; |
| "independent reporting accountants" or "Mazars" | Mazars Audit (Practice Number 900222), Mazars House, 54 Glenhove Road, Melrose Estate, Johannesburg, 2196, the auditor and independent reporting accountant to Magni Resources; |
| "iNgwenyama" | iNgwenyama is the title of the King of Eswatini; |
| "invited investors" | those specifically identified individuals, financial institutions, brokers, selected private clients, BEE and BBBEE investors and selected retail investors to whom the offer under the Private Placing will be addressed and made available through identified platforms, in South Africa, Eswatini and other countries where permitted; |
| "Issue of Shares" | the private placing of the Private Placement Shares in terms of a Prospectus to individuals, institutions, companies, stockbrokers and other entities by way of a book build; |
| "Jaco Lotheringen" | Jacobus Johannes Lotheringen, an independent advisor and member of the Investment Committee of Magni Resources; |
| "JSE" | Johannesburg Stock Exchange; |
| "JSE Investor Services" | JSE Investor Services South Africa Proprietary Limited (Registration number 2000/007239/07), Fifth Floor, One Exchange Square, Gwen Lane, Sandown, 2196; |
| "JSE Limited" | the JSE Limited, (Registration number 2005/022939/06), a public company duly registered and incorporated with limited liability in accordance with the laws of South Africa and licensed as an exchange under the FMA; |
| "JSE Listings Requirements" | the Listings Requirements of the JSE, as amended from time to time; |
Definitions and Interpretation — Continued
| Term | Definition |
|---|---|
| "Karabo Ramela" | Karabo Mokale Ramela, the Chief Financial Officer of Magni Resources, based at 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196; |
| "King Code" or "King IV" | the King Report on Corporate Governance, which was released on 1 September 2009 and came into effect on 1 March 2010; |
| "last practicable date" | the last practicable date prior to the finalisation of this Prospectus, being 17 February 2023; |
| "Listing" | the listing of the Company on the Main Board of the JSE; |
| "Lurco Coal" | Lurco Coal Proprietary Limited (Registration number 2010/013626/07), a private company duly incorporated in accordance with the laws of South Africa, having as its registered address 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196, formerly held by Lurco Group Proprietary Limited and the directors being Mr Aubrey Chauke and Mr Thomas Samons, which company was placed into Business Rescue in 2020 and subsequently placed into provisional liquidation at the Last Practicable Date. Lurco Coal has no relationship with Magni Resources or Lurco Coal Eswatini and the liquidation of this entity will have no impact on the Magni Resources group; |
| "Lurco Coal Eswatini" | Lurco Coal Eswatini Proprietary Limited (Company ID 201106101007344, Company No. R7/35160), a private company duly incorporated on 10 June 2011 in accordance with the laws of Eswatini (formerly Swaziland), having as its registered address 20th Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196, a wholly owned subsidiary of Magni Resources; |
| "Lurco Domestic Trades" | Lurco Domestic Trades Proprietary Limited (Registration number 2019/315088/07) a private company duly incorporated in accordance with the laws of South Africa, having as its registered address 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196, which company markets commodities in the South African market and is held 100% by Magni Investments and a related group to Magni Resources; |
| "Magni Investments" | Magni Investments Proprietary Limited (Registration number 2011/107328/07), a private company duly incorporated in accordance with the laws of South Africa, having as its registered address 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196, the controlling shareholder of Magni Resources and the directors being Mr Ellington Nxumalo and Mr Aubrey Chauke; |
| "Magni Investment Shareholders" | the shareholders in Magni Investments being: Inkomati Mining (Pty) Ltd, associated with Aubrey Chauke (13,60%), of which 50% is owned by Vutlhari Business Trust. Vutlhari Business Trust beneficiaries are Aubrey Chauke, Helen Chauke and Justin Tshepiso Chauke; Mokale Oarabile Investments (Pty) Ltd (7,45%), owned 100% by Karabo Ramela; Magni Investment Holdings International (51%), which company is controlled by Inkomati Mining (63.6%) and Mokale Aorabile Investments (10%); KK Fuel Logistics (Pty) Ltd (10%), owned 50% by Mr Kajiya Kantumoya and 50% by Ms Edith Lungu; Nel Clan Investment Holdings (Pty) Ltd (3,45%); Four22 Investments (Pty) Ltd (2%); Isaac M Family Trust (2%); Adizania (Pty) Ltd (2%); Fueleth Projects (Pty) Ltd (2%); MEH Investments (Pty) Ltd (2%); NDK Consulting CC (1,5%); Naik Investment Solutions (Pty) Ltd (1,5%); Active Blue Trading 177 CC (1,5%); |
| "Magni Resources" or "the Company" | Magni Resources Limited (Registration number 2022/540635/06), a public company duly incorporated in accordance with the laws of South Africa on 10 June 2022 as a private company, having as its registered address 20 The Piazza, 1st Floor, Melrose Arch, Johannesburg, 2196, with wholly owned subsidiary, Lurco Coal Eswatini; |
| "Marketing Agent" | Lurco Marketing, a company to be formed and owned by Magni Investments, appointed as the exclusive marketing agent to Magni Resources in terms of the Marketing Agreement as detailed in Annexure 17; |
| "Marketing Agreement" | the marketing agreement between Magni Resources and the Marketing Agent, dated 21 November 2022, with effect from 1 November 2022 as detailed in Annexure 17; |
| "Mazule Holdings" | Mazule Holdings Proprietary Limited, (Registration number 2018/093954/07) a private company duly incorporated in accordance with the laws of South Africa, having as its registered address Office 301 Vineyard Centre, Vineyard Road, Claremont, Western Cape, 7708, which company markets commodities in the international markets and is held 100% by Mr Christopher John Dyason and the directors being Mr Ryan Christopher Moss, Mr Malcolm Campbell, Mr Christopher John Dyason, Mr Brent Omland and Mr Andrew Thomas Malashwesky, which company is not a related party to Magni Resources; |
| "Mdu Gama" | Mduduzi Edward Gama, an Independent Non-Executive Director and Chairman of the Board of Directors, member of the Social and Ethics Committee, Nominations and Remunerations Committee and Investment Committee of Magni Resources of 25 Courtday Crescent, Randjesfontein Country Estate, Midrand, 1685; |
| "Minerals Management Board" | the Minerals Management Board as established by section 214 of the Constitution and provides rules relative to exploration and exploitation of minerals in Swaziland; |
| "Mining Right/s" | a mining right issued in terms the Swaziland Mines and Minerals Act, 2011 (Act No.4 of 2011), which application was submitted by Lurco Coal Eswatini on 12 August 2022 for the Mpaka Coal Project, Application Number 408/2022 and which is expected to be awarded in the first quarter of 2023; |
| "Mpaka Coal Project" | the intended mining of anthracite for a period of 18 years in term of the application for the Mining Right following the completion of the exploration work under the Prospecting Licence granted to Lurco Coal Eswatini on an extent of approximately 5837,9437 Hectares, situated on Farm 1 049 Lubombo District, Eswatini, that include the defunct Emaswati Colliery site at Mpaka, Lubombo Region, Eswatini; |
| "MOI" | the Memorandum of Incorporation of the Company, salient extracts of which are set out in Annexure 13; |
| "non-resident" | a person whose registered address is outside the common monetary area and who is not an emigrant; |
| "Nunda Naidoo" | Nunda Naidoo, an independent advisor and Chairman of the Investment Committee of Magni Resources; |
| "Offer Price" | the price at which the Private Placing Shares are offered for subscription at the Offer Price Range by Magni Resources, pursuant to this Prospectus noting that the Offer Price may fall outside the Offer Price Range; |
| "Offer Price Range" | the indicative pricing range of the Offer, being R4.50 to R5.50 per Offer Share, with a target placing price of R5.00 per share, noting that the Offer Price may fall outside the Offer Price Range; |
| "Ordinary Shares" or "Shares" | ordinary Shares in the share capital of the Company, having no par value; |
| "own-name registration" | registration in own name of shareholders who hold/will hold ordinary Shares which have been dematerialised and are recorded by a CSDP on the sub-register kept by that CSDP in the name of such shareholder; |
| "Private Placing" | the private placing of new shares for subscription by way of a Prospectus to individuals, institutions, companies, stockbrokers and other entities at the Offer Price, which private placing will take place by way of a book build; |
| "Private Placement Shares" | the offer of up to 52 500 000 new Shares in the Company at the Offer Price ranging from R4.50 to R5.50 per share, at a target price of R5.00 per share, for approximately R262 500 000; |
| "promoter" | the party(ies) responsible for the formation of a company to be listed, or acquired by an existing issuer, and who earn(s) a fee therefrom, in cash or otherwise, as defined in the JSE Listings Requirements; |
| "Prospecting Licence" | the Prospecting Licence to prospect and search for coal granted to Lurco Coal Eswatini on an extent of approximately 5837,9437 Hectares, situated on Farm 1 049 Lubombo District, Eswatini, which right was applied for in 2011 and was granted 12 November 2021 from 4 October 2021 for a period of 12 months to 3 October 2022, during which period, having completed the exploration prospects, Lurco Coal Eswatini applied for the Mining Right, which application is under consideration; |
Definitions and Interpretation — Continued
| Term | Definition |
|---|---|
| "Rand" or "R" or "cents" | South African Rand, the official currency of South Africa; |
| "register" | the share register of Magni Resources shareholders; |
| "SARB" | the South African Reserve Bank; |
| "SENS" | the Stock Exchange News Service of the JSE; |
| "shareholders" | the holders of issued ordinary shares as recorded in the share register of the Company; |
| "South Africa" or "the Republic" | the Republic of South Africa; |
| "Strate" | the settlement and clearing system used by the JSE, managed by Strate Proprietary Limited, (Registration number 1998/022242/07), a private company duly incorporated in accordance with the laws of South Africa; |
| "Subsidiary" | Lurco Coal Eswatini; |
| "Supplementary Circular" | the issue of supplementary information pursuant to the award of the Mining Right by Lurco Coal Eswatini, which information will include updated valuation information prepared by the Competent Person as well as the pro forma financial effects of the fair value of the Mining Right and subsequent disposal of 50% of Lurco Coal Eswatini as a condition of the Mining Right, which information will be approved by the JSE, filed with CIPC and published on SENS and the website www.magniresources.com, prior to the closing of the Offer; |
| "Thami Moatshe" | Nomathamsanqa Moatshe, an Independent Non-Executive Director and a member of the Audit and Risk Committee, the Nominations & Remunerations Committee and the Social and Ethics Committee of Magni Resources of 16 Brendon Avenue, Morningside Manor, Sandton, 2196; |
| "Tinyiko Mhlari" | Tinyiko Mhlari, an Independent Non-Executive Director, Chairman of the Audit and Risk Committee and member of the Nomination and Remuneration Committee of Magni Resources of 1 Robin Avenue, 134 Kyalami Boulevard Estate, Kyalami Hills, Midrand, 1685; |
| "VAT" | value added tax as defined in the Value Added Tax Act, 1991, as amended; |
| "Zodwa Mobeng" | Dolly Ntombizodwa Mobeng, an Independent Non-Executive Director, Chairman of the Social and Ethics Committee and member of the Audit and Risk Committee of Magni Resources of 11 Paardeberg Street, Helderwyk Estate, 1541. |
Bridge Facility — Key Defined Terms
| Term | Definition |
|---|---|
| Bridge Facility / The Loan | The proposed $70,000,000 USD senior secured private debt term loan detailed in this document. |
| BVI / MS800 | Business Venture Investments No 2104 (Pty) Ltd and its wholly-owned subsidiary Main Street 800 (Pty) Ltd, the operating entity holding the mining rights to the Makunyula Anthracite Mine. |
| Company / MIH | Magni Investment Holdings (Pty) Ltd, acting as the primary Sponsor and ultimate holding entity prior to the corporate restructuring. |
| Competent Person's Report (CPR) | An independent technical report prepared in accordance with the SAMREC Code, required for technical validation by the JSE Readers' Panel prior to Listing. |
| Deed of Undertaking | A legally binding document executed by the directors of MRL, enforcing the First-Pay Obligation and establishing personal fiduciary liability for non-compliance. |
| Designated Advisor | AcaciaCap Advisors Proprietary Limited, the JSE-licensed sponsor mandated to guide the regulatory Listing process. |
| Event of Default | Any breach of covenants, failure to execute the First-Pay Obligation, or failure of the GEM Purchaser to settle a valid Subscription Notice within the stipulated 30-day cure period. |
| Term | Definition |
|---|---|
| First-Pay Obligation | The absolute legal requirement for MRL's treasury to prioritize the settlement of the Lender's debt immediately upon receipt of any funds from the GEM Facility, prior to any other corporate capital allocation. |
| GEM Facility | The $300,000,000 USD Share Subscription Facility (SSF) dated August 28, 2021, and amended July 24, 2025, provided by Global Emerging Markets (GEM). |
| Irrevocable Payment Guarantee | A senior, unconditional corporate guarantee issued by MIH in favor of the Lender, acting as a primary obligor guaranteeing the debt of MRL. |
| Issuer / MRL | Magni Resources Limited, the primary operating entity slated for listing on the Main Board of the Johannesburg Stock Exchange. |
| Take-Out Event | The mandatory prepayment and settlement of the Bridge Facility using the proceeds derived from the GEM Facility, executed via the First-Pay Obligation. |
A landmark $70 000 000.00 USD senior secured bridge facility engineering the JSE listing of Magni Resources Limited and unlocking the $300M GEM equity backstop — with a Liquidity Coverage Ratio exceeding 4.0x.
Magni Investment Holdings (Pty) Ltd ("MIH") is in the final, critical stages of progressing toward a landmark public listing of Magni Resources Limited ("MRL") on the Main Board of the Johannesburg Stock Exchange (JSE). This transition from a private resources group to a publicly traded entity is heavily supported and de-risked by a committed, binding $300 000 000.00 USD Share Subscription Facility provided by Global Emerging Markets ("GEM"), which serves as a guaranteed institutional equity backstop post-listing.
To maximize the IPO valuation and ensure the company lists as a robust, revenue-generating entity, MIH requires a $70 000 000.00 USD Bridge Facility. This strategically upsized facility is multi-purposed: it covers the intensive 12-month regulatory "Listing Sprint," finalizes all technical SAMREC reporting, and crucially, funds the strategic acquisition and aggressive capitalization of the Makunyula Anthracite Mine. By deploying these funds to pull Makunyula out of business rescue and into active production, MRL immediately transitions from a development-heavy portfolio to a cash-generative enterprise, fundamentally altering its day-one listing valuation.
This document outlines a secured, institutional-grade debt structure designed specifically for top-tier funders. It leverages the massive GEM commitment as the primary security architecture. By shifting the repayment reliance away from the inherent, variable risks of junior mining operations and onto a multi-hundred-million-dollar institutional equity commitment, this structure provides a highly secure, SARB-compliant, and clearly defined exit pathway for the incoming debt funder, characterized by an exceptional Liquidity Coverage Ratio.
Key Investment Highlights
Massive Security Coverage Ratio: The exit is structurally guaranteed by a committed $300 000 000.00 USD Share Subscription Facility Agreement (SSFA) provided by Global Emerging Markets (GEM). The $70M debt represents less than 25% of the primary liquidity backstop.
Unlike traditional junior mining debt, repayment does not rely on operational cash flows or production milestones. The Take-Out event is a strictly mechanical, contractual equity drawdown post-listing.
The facility introduces a legally binding "First-Pay Obligation," ensuring GEM equity funds flow directly into MRL's accounts, whereupon MRL's directors are legally bound by a Deed of Undertaking to immediately remit settlement to the Funder.
Section 1
Magni Investment Holdings (Pty) Ltd ("MIH"), the sponsor, is securing a $70 000 000.00 USD Senior Secured Private Debt Term Loan to fund the final pre-listing capitalization and strategic acquisitions for Magni Resources Limited ("MRL"). MRL is slated for a landmark listing on the Main Board of the Johannesburg Stock Exchange (JSE) in November 2026, a process actively managed by JSE-licensed sponsor AcaciaCap Advisors Proprietary Limited.
This transaction presents a unique, institutional-grade private credit opportunity underpinned by a massive structural backstop. The debt is fully underwritten by Hard-Asset Underwriting: the debt is secured by a pledge of 100% of MRL's issued share capital held by MIH, alongside Notarial Bonds over unencumbered yellow-metal mining equipment and fixed infrastructure.
Section 2
Magni Resources Limited (MRL) is a highly diversified, JSE Main Board-listed resources powerhouse engineered for high-alpha Enterprise Value creation — blending near-term cash-generative coal assets with high-upside critical and precious metals.
2.1. Corporate Pedigree and Strategic Positioning
Magni Resources Limited ("MRL"), incorporated in June 2022, serves as the primary operational and listing vehicle for its sponsor, Magni Investment Holdings (Pty) Ltd ("MIH"). The group's foundational DNA is rooted in Lurco, an established, majority black-owned resources group founded in 2010 by industry veterans Ellington Nxumalo and Aubrey Chauke. Lurco possesses a formidable 14-year track record spanning coal beneficiation, complex project financial management, and direct supply to Eskom and major international utilities. By injecting this deep operational and bulk-commodity trading expertise into MRL, the group is transitioning from a private development vehicle into a highly diversified, JSE Main Board-listed resources powerhouse. The pre-listing portfolio is aggressively engineered for high-alpha Enterprise Value (EV) creation, blending immediate cash-generative coal assets with high-upside critical and precious metals to align with global energy transition megatrends.
2.2. Near-Term Cash Flow Drivers
The base valuation and day-one cash flow profile of MRL are anchored by three highly strategic, advanced-stage coal assets.
MRL is executing the acquisition of a 51% controlling stake in Main Street 800 (Pty) Ltd, rescuing the asset from business rescue proceedings. With 200 million tons of anthracite in situ in Mpumalanga, this asset requires an estimated $150 million USD in development capital but provides immediate near-term cash flow capabilities as a semi-operational, tier-one project. The strategic buyout immediately transitions MRL into a formidable domestic anthracite producer.
Spanning 847.73 hectares in the Eswatini Lowveld, this anthracite project boasts a 60 million ton total resource (16Mt Measured, 9Mt Indicated, 35Mt Inferred). The raw coal yields a highly favourable, low-ash product (~15.5% product ash) with high fixed carbon (70.5%), positioning it perfectly for the South African ferroalloy industry and Brazilian pelletizing markets.
The project demonstrates exceptional projected margin profiles. Management estimates Free on Rail (FOR) operating expenses at R1,471 per saleable ton, against conservative saleable FOR pricing of R3,240 per ton. Production is slated to ramp up rapidly to 574,000 tons per annum (Ktpa) by FY2027 and 1.4 million tons per annum (Mtpa) by FY2028. Crucially, the asset sits adjacent to an existing rail siding, seamlessly linking it to both inland domestic markets and offshore export terminals in Maputo and Richards Bay.
An immense 800 million ton thermal coal asset located across 11,858.50 hectares in the Balfour district of Mpumalanga. The deposit offers qualities ranging from 4800 Kcal to 5500 Kcal. Historically a "cost-plus" partner to Eskom, Grootvlei serves as MRL's long-term baseload thermal energy play, with an estimated $450 million USD required to fully develop the opencast and underground operations.
2.3. Precious and Critical Metals (The Valuation Multipliers)
To diversify sovereign risk and capture the valuation premiums associated with future-facing commodities, MRL has secured controlling stakes in highly prospective international exploration assets.
MRL holds a 51% stake in a massive 602 square kilometer concession in the highly prolific Birimian-age greenstone belt, sharing the same geological terrain as the multi-million-ounce Tasiast Gold mine. The project is targeting the definition of a 1.5 million to 5.0 million ounce gold resource. MRL is launching a highly structured, 12-month, $3.4M – $4.3M USD exploration and Preliminary Economic Assessment (PEA) program. This includes 16,800 meters of drilling to deliver a JORC / NI 43-101 compliant resource, drastically de-risking the asset and unlocking major joint-venture financing optionality post-listing.
Securing 100% operational rights via a Public-Private Partnership across four permits covering roughly 70,000 hectares in the Niassa Province. The Alkaline Complex (Naumale-Meponda) geology is a globally recognized host for highly strategic critical minerals, including Niobium (Nb), Tantalum (Ta), Uranium (U), and Rare Earth Elements (REE). MRL has mapped a fully costed $12.79 million USD, 24-month horizon budget to advance the asset through resource definition to pre-feasibility, tapping directly into the supply chain for global electric vehicle and advanced electronics manufacturing.
2.4. M&A Pipeline: The SepFluor Acquisition Bid
Further cementing the upside of the transaction, MRL has submitted a formal bid, financially backed by the GEM equity facility, to acquire 100% of SepFluor Limited (Project Toro).
SepFluor operates the world-class Nokeng Fluorspar Mine in Gauteng, utilizing state-of-the-art concentrator technology to produce top-tier acidspar (>97% CaF2). Acidspar is a critical component in the production of refrigerants, solar panels, and lithium-ion batteries.
Nokeng is a highly cash-generative asset, delivering an average of 55% year-on-year revenue growth over the last four years and boasting projected Life of Mine (LOM) EBITDA margins of approximately 60%.
The acquisition includes the fully permitted Wallmannsthal development project (8.0 Mt resource) and the Kruidfontein exploration asset. Successfully closing this transaction (targeted for Q4 2026) would require over $250 million USD but would instantly elevate MRL into a globally significant critical minerals producer with massive, predictable free cash flow.
Section 3
The underlying asset portfolio of Magni Resources Limited (MRL) has been strategically assembled to capitalize on three distinct, high-conviction macroeconomic megatrends. Unlike traditional junior miners highly exposed to singular commodity cycles, MRL's valuation is insulated by a barbell strategy: generating near-term, high-margin cash flow from domestic thermal and metallurgical coal, while utilizing international gold and critical battery minerals as exponential valuation multipliers. The $70,000,000 Bridge Facility is deployed into a macroeconomic environment where supply constraints heavily favor MRL's specific asset base.
The global pivot away from fossil fuel investment by tier-one mining houses has created a profound market dislocation: while capital expenditure has collapsed, industrial demand for high-quality carbon reductants remains highly inelastic. This chronic underinvestment has engineered a structural supply deficit, effectively establishing a high and sustained price floor for permitted, near-production assets.
As the JSE listing approaches, MRL's valuation is significantly buoyed by its exposure to gold via the Ararim asset. The macroeconomic environment for gold is experiencing a historic structural shift, driven away from pure real-yield correlations and toward sustained geopolitical accumulation.
The most transformative element of MRL's macro positioning is the targeted acquisition of SepFluor. This pivot aligns the company with the multi-trillion-dollar global energy transition and secures the interest of forward-looking ESG institutional capital.
Magni Resources Limited (MRL) is led by a highly experienced, multi-disciplinary management team and board of directors. The leadership framework combines deep operational mining expertise, tier-one corporate and investment banking experience, and rigorous independent legal and financial oversight, ensuring robust governance and execution capacity ahead of the JSE listing.
4.1. Executive Directors
Chief Executive Officer & Co-Founder
Aubrey brings over 17 years of specialized experience in the financial management, operational execution, and strategic development of complex integrated coal mining projects. As an advocate for the role of resources in developing sustainable economies, he has built a vast operational network across the Southern African mining landscape. He holds an Honours Degree in Commerce (Accounting & Finance) from the University of KwaZulu-Natal and is a registered member of the South African Institute of Professional Accountants (SAIPA). Aubrey's extensive operational matrix includes leading exploration, mineral extraction, processing, and bulk logistics across coal, chrome, and precious metals for the Lurco Group. He possesses significant expertise in contract negotiation, capital raising, Original Equipment Manufacturer (OEM) procurement, and managing multi-national commodity trading (including hedging, letters of credit, and vessel booking) into international markets.
Chief Financial Officer & Co-Founder
Karabo is a Chartered Accountant (SA) with 16 years of high-level experience spanning Corporate & Investment Banking, Private Equity, and Investment Holdings. He holds a Bachelor of Accounting Sciences (Wits), a PG Dip in General Management, and an MBA (GIBS). Following his articles at Deloitte, Karabo spent eight years in the Corporate & Investment Banking divisions of Standard Bank and ABSA Group. Notably, as a Senior Credit Analyst in Mining & Project Finance at ABSA, Karabo managed a tier-one client portfolio that included Gold Fields, Sibanye Stillwater, and Sedibeng Iron Ore. He specializes in investment structuring, complex capital budgeting, and mining risk management, providing MRL with an institutional-grade approach to treasury management and cross-border financial compliance.
4.2. Independent Non-Executive Directors
INED — Chairman: Nominations, Remuneration & Investment Committee
A practicing corporate commercial attorney with 19 years of experience. Basil spent nearly a decade at the Takeover Regulation Panel (TRP) as Legal Counsel and Deputy Executive Director, making him a preeminent specialist in mergers and acquisitions under the South African Companies Act. He brings tier-one corporate governance and litigation oversight to the board.
INED — Chairman of the Board
Holding a PhD in Finance (University of Johannesburg) and an MBA, Mdu brings extensive financial structuring and operational turnaround experience. He is the Founder and CEO of Meeg Asset Finance and has held senior executive roles in corporate finance and strategic market development at SAB, RentWorks, and Unilever.
INED — Chairman: Audit & Risk Committee
A Chartered Accountant (SA) and Executive Director at PSTM Auditors. With a background as a Financial Planner at ABI (SABMiller) and an External Audit Supervisor at KPMG, Tinyiko provides rigorous oversight of MRL's financial controls, audit processes, and compliance with IFRS.
INED — Social & Ethics Committee
Thami holds an MBA (Henley) and a Master of Management in Finance & Investment (Wits). She is the Executive Head of the Localisation Support Fund and previously served as the first female Group CFO of Servest. Crucially for MRL, she spent 11 years as a Senior Portfolio Manager at the Industrial Development Corporation (IDC), managing over R50 billion in listed mining and petroleum investments.
INED — Chairman: Social & Ethics Committee
An admitted Attorney and Executive Manager for Corporate Services at the RTMC, Zodwa is a transformational corporate governance specialist with over 23 years of experience managing large-scale human capital, legal compliance, and social development frameworks.
4.3. Key Management & Independent Technical Advisors
Executive: Projects and Technology
Gladwin is a Professional Technologist Engineer (Pr. Tech Eng.) with a BSc (Hons) in Management of Technology and an MBA. He brings specialized metallurgical and process engineering expertise to MRL's operational rollout. Previously a Senior Process Engineer at Worley (TWP) and an Anglo Platinum Metallurgist, Gladwin has extensive experience managing high-capex mining, minerals, and metals projects across Sub-Saharan Africa.
Outside Independent Technical Expert
Jaco is a highly regarded Principal Mining Engineer with over 18 years of experience. Holding a B.Eng in Mining Engineering and a Mine Manager's Certificate of Competency, Jaco has directed key operational developments at Exxaro (Tshikondeni), Kumba Iron Ore, and Anglo Platinum. As co-founder of Ukwazi, his technical oversight is critical for validating MRL's Bankable Feasibility Studies and Competent Person's Reports.
Outside Independent Commercial Expert
Nunda is an MSc Chemical Engineer with over three decades of tier-one energy and petrochemical experience. His career highlights include serving as Lead Startup Engineer for the $7 billion Mossgas Project, Senior Transactor in Project Finance at Rand Merchant Bank, and Managing Director of PetroConsult SA. His deep expertise in energy policy, fuel trading (Mercuria Energy), and capital structuring significantly strengthens MRL's commercial and strategic positioning.
The $70 000 000.00 USD Pre-IPO Bridge Facility is strictly ring-fenced and meticulously allocated across five core tranches. Unlike traditional working capital facilities, this debt is engineered as "catalytic capital." Every dollar deployed is explicitly designed to exponentially increase the Day-1 Enterprise Value (EV) of Magni Resources Limited (MRL) upon its JSE listing, thereby maximizing the efficiency of the $300M GEM equity drawdown and guaranteeing the Lender's exit.
5.1. Makunyula Acquisition & Business Rescue Exit ($40 000 000.00 USD)
This pivotal tranche fully funds the strategic buyout of a 50% plus 1 share controlling interest in Business Venture Investments No 2104 (Pty) Ltd (BVI / MS800), the entity holding the 200 MT Makunyula Anthracite Mine. Creditor Compromise (~R416 Million ZAR): Direct advance of a secured loan to definitively settle 100% of the current MS800 creditors, legally discharging the asset from the business rescue process. Asset Capitalization & Restart (~R250 Million ZAR): Direct cash injection to repair existing wash plant infrastructure, mobilize tier-one mining contractors, and commence immediate open-cast extraction at the Makunyula North-North pit. This allocation transforms MRL from a "development-heavy" exploration play into an active, cash-generative producer before the IPO. By listing with a producing asset, MRL commands a massive valuation premium. A higher listing price means MRL issues fewer shares to GEM to settle the Lender's debt, protecting the Sponsor from dilution and ensuring the $300M GEM facility has massive structural headroom. This capital also purchases heavy, tangible mining infrastructure and unencumbered yellow-metal equipment, which are immediately pledged to the Lender via Special and General Notarial Bonds, providing a robust, physical "Plan B" recovery mechanism if the listing is delayed.
5.2. Project Acceleration & Technical Capex ($13 500 000.00 USD)
Capital allocated to advance the group's "shovel-ready" assets, demonstrating operational momentum to institutional IPO investors. Lurco Coal Eswatini (Mpaka Project): Initial capital for primary shaft sinking, site establishment, and the clearing/refurbishment of the adjacent export-enabling rail siding to support the targeted 574 Ktpa initial ramp-up. Grootvlei Colliery: Funding for heavy equipment mobilization, initial box-cut preparation for the open-cast section, and essential water management infrastructure. By utilizing this debt to break ground and advance technical milestones prior to listing, MRL ensures a highly oversubscribed IPO, stabilizing the secondary market share price and ensuring the GEM facility can be drawn down seamlessly to execute the Lender's Take-Out event.
5.3. Pre-IPO Operational Working Capital & Contingency ($9 999 000.00 USD)
This tranche isolates and secures the corporate runway through the intensive 12-month "Listing Sprint" targeted for November 2026. Corporate Overheads: Funding executive management structuring, group treasury operations, site security protocols across multiple jurisdictions, and stringent environmental compliance monitoring. Financial Contingency: A robust capital buffer to absorb any unforeseen macroeconomic shocks or regulatory delays during the JSE listing process. This tranche guarantees MRL's corporate stability, ensuring all debt covenants, tax liabilities, and operational minimums are flawlessly maintained. It ensures the "corporate vessel" arrives intact at the JSE, which is the absolute prerequisite for activating the GEM repayment mechanism.
5.4. Regulatory, Technical & Professional Fees ($3 510 000.00 USD)
Funding dedicated exclusively to satisfying the stringent regulatory and technical requirements of the JSE Main Board. Advisory Retainers: Settlement of mandated fees for AcaciaCap Advisors (JSE Sponsor), Mazars (Independent Auditors / Reporting Accountants), and Webber Wentzel (Legal Counsel). Technical Validation: Funding the finalization of SAMREC-compliant Competent Person's Reports (CPRs) and Bankable Feasibility Studies (BFS) required by the JSE Readers' Panel. This literally "buys the exit." The $300M GEM facility is strictly contingent upon a successful public listing. Therefore, paying the tier-one auditors, lawyers, and technical sponsors is not an operational expense; it is the direct capital required to unlock the Lender's repayment source.
5.5. Strategic International Exploration ($3 000 000.00 USD)
Funding directed to the Ararim Gold Project in Mauritania to prove up the group's precious metals portfolio. Phase 1 Drilling Program: Execution of 16,800 meters of surface drilling (RC/RAB and DD) across the 602 square kilometer concession. Resource Definition: Finalizing a JORC / NI 43-101 compliant preliminary resource estimate targeting 1.5M to 5.0M ounces of gold, plus conducting geophysics and metallurgical test work. While South African coal provides immediate cash flow, international investors increasingly demand commodity diversification and future-facing asset exposure. Every ounce of gold added to MRL's resource base at this stage exponentially increases the company's JSE listing valuation, ensuring GEM's equity is drawn down at the maximum possible price per share. This protects the Lender by maximizing the absolute dollar value of the repayment backstop.
5.6. Use of Proceeds Summary
| Allocation | Category | Amount (USD) | % of Facility | Primary Objective |
|---|---|---|---|---|
| Allocation 1 | Makunyula Acquisition & Business Rescue Exit | $40 000 000.00 | 57.14% | Acquire 50%+1 of BVI/MS800, settle business rescue creditors (~R416M ZAR), fund initial asset capitalization and restart (~R250M ZAR) |
| Allocation 2 | Project Acceleration & Technical Capex | $13 500 000.00 | 19.29% | Early works at Mpaka (shaft sinking, rail siding) and Grootvlei (box-cut, water management infrastructure) |
| Allocation 3 | Pre-IPO Operational Working Capital & Contingency | $9 999 000.00 | 14.27% | Corporate runway, executive overheads, site security, environmental compliance, and financial contingency for the 12-month Listing Sprint |
| Allocation 4 | Regulatory, Technical & Professional Fees | $3 510 000.00 | 5.01% | JSE Sponsor (AcaciaCap), Auditors (Mazars), Legal Counsel (Webber Wentzel), SAMREC CPRs and BFS finalization |
| Allocation 5 | Strategic International Exploration | $3 000 000.00 | 4.29% | Ararim Gold Phase 1 drilling (16,800m), JORC/NI 43-101 resource definition targeting 1.5–5.0 Moz gold, geophysics and metallurgical test work |
| TOTAL FACILITY | $70 000 000.00 | 100.00% | Full deployment to maximize JSE Day-1 Enterprise Value | |
Section 6
To accommodate the diverse yield, duration, and structural preferences of potential institutional funders, the facility is presented in two distinct, commercially viable structural options. Both options are anchored by identical First-Pay Obligation repayment mechanisms and the same comprehensive security package. The key differentiator is whether the Lender prefers a single, high-yield bullet payment (Option A) or a quarterly amortization post-listing (Option B). All figures below are indicative and subject to final negotiation at the Term Sheet stage.
Option A — Bullet Take-Out (Floating Rate)
| Term | Commercial & Legal Provision |
|---|---|
| Facility Type | Senior Secured Pre-IPO Bridge Facility (Term Loan) |
| Borrower | Magni Resources Limited ("MRL") |
| Guarantor / Primary Obligor | Magni Investment Holdings (Pty) Ltd ("MIH") |
| Facility Amount | US$70 000 000.00 (Seventy Million US Dollars) |
| Tenor | 12 Months from the date of Financial Close |
| Interest Rate | South African Prime Lending Rate (Floating) — capitalizes monthly in arrears |
| Repayment Mechanism | 100% Principal + all accrued interest in a single bullet payment at Maturity, funded by the First-Pay Obligation upon the first GEM drawdown |
| Mandatory Take-Out Event | Full and immediate retirement of the facility upon JSE admission and first GEM Subscription Notice settlement |
| Conditions Precedent (CPs) to Drawdown | 1. Legal: Execution of the Master Facility Agreement, Deed of Undertaking, and all Security Documents; Delivery of Certified Board Resolutions from MRL and MIH authorizing the transaction and the First-Pay Obligation. 2. Corporate: Delivery of the executed Deed of Amendment (dated July 24, 2025) for the GEM Facility formally naming MRL as the Issuer. 3. Regulatory: Issuance of a Loan Reference Number (LRN) from the South African Reserve Bank (SARB) Financial Surveillance Department approving inward capital flows. 4. Technical: Written confirmation from AcaciaCap Advisors confirming the JSE listing timetable is active and targeted for November 2026. |
| Negative Covenants | No incurrence of additional senior or pari passu debt; no payment of dividends or distributions until the facility is retired in full |
| Events of Default | First-Pay failure; insolvency event; listing withdrawal; GEM non-settlement beyond the 30-day cure period |
| Governing Law | South African law, jurisdiction of the South Gauteng High Court |
Option B — Quarterly Post-Listing Amortization (Fixed Rate)
| Term | Commercial & Legal Provision |
|---|---|
| Facility Type | Senior Secured Post-Listing Amortizing Term Loan |
| Borrower | Magni Resources Limited ("MRL") |
| Guarantor / Primary Obligor | Magni Investment Holdings (Pty) Ltd ("MIH") |
| Facility Amount | US$70 000 000.00 (Seventy Million US Dollars) |
| Tenor | 12–24 Months, with quarterly amortization schedule commencing post-JSE listing |
| Interest Rate | South African Prime Lending Rate + 2.00% p.a. (Fixed at Financial Close) |
| Repayment Mechanism | Level-payment quarterly amortization installments, each funded by a sequential GEM Subscription Notice drawdown |
| Funding Mechanism | Each quarterly payment is funded by a scheduled GEM Subscription Notice; the First-Pay Obligation applies to each inflow event separately |
| Anti-Dilution Protection | Floor Price Protection Covenant: if the 15-trading-day VWAP falls below an agreed threshold, GEM Subscription Notices are paused and a Commercial Refinancing Covenant is triggered |
| Conditions Precedent (CPs) to Drawdown | 1. Legal: Execution of the Master Facility Agreement, Deed of Undertaking, and all Security Documents; Certified Board Resolutions. 2. Corporate: Signed Deed of Amendment for the GEM Facility naming MRL as the Issuer. 3. Regulatory: Issuance of an LRN from SARB. 4. Technical: Written confirmation of the JSE listing timeline from AcaciaCap Advisors. |
| Reporting Obligations | GEM Subscription Notice issued within 24 hours of each quarterly settlement date; monthly management accounts; annual AFS within 90 days of year-end |
| Governing Law | South African law, jurisdiction of the South Gauteng High Court |
Primary Security Package (Both Options)
1. First-Ranking Cession & Pledge over all proceeds of the GEM Facility · 2. Unconditional Irrevocable Primary Corporate Guarantee issued by Magni Investment Holdings (Pty) Ltd (MIH) as primary obligor · 3. Perfected Pledge and Cession of 100% of MRL issued share capital held by MIH · 4. Special & General Notarial Bonds over unencumbered yellow-metal mining equipment, wash plants, and fixed infrastructure at Mpaka, Grootvlei & Makunyula assets
Section 7
The most critical differentiator of this transaction is its repayment architecture. Unlike conventional junior mining debt — which relies on uncertain cash flow from production ramp-ups, subject to operational, regulatory, and commodity price risks — this bridge facility's repayment mechanism is entirely decoupled from MRL's mining operations.
7.1. The Repayment Context & Conditional Payment Mechanism
The Take-out event is anchored to a committed, binding $300 000 000.00 USD equity facility from a single, known institutional counterparty (GEM), activated by a straightforward mechanical action (the JSE listing and a Subscription Notice). The three-stage repayment crystallization proceeds as follows:
Upon MRL's successful admission to the JSE Main Board (targeted November 2026), MRL formally issues a Subscription Notice to the GEM Purchaser under the terms of the $300 000 000.00 USD Share Subscription Facility Agreement. MRL's financial obligation to the Lender remains recognized but is held in a dormant state — the condition precedent (the listing) has been satisfied, but the payment mechanism has not yet fully crystallized.
In accordance with SARB exchange control regulations (and the pre-approved Loan Reference Number governing the Bridge Facility), GEM remits the required USD equity capital directly into MRL's nominated South African corporate bank account. This event definitively satisfies the inward-flow requirements and fulfils the "condition precedent" of the Conditional Guarantee to Pay.
The precise moment GEM funds clear into MRL's account, the Conditional Guarantee to Pay crystallizes into an absolute, unconditional, and immediately enforceable payment obligation. MRL's treasury is now legally bound by the First-Pay Obligation and the executed Deed of Undertaking to immediately remit the full and complete settlement of the Bridge Facility to the Lender. This payment is made before any other corporate capital allocation, including operational expenses, supplier payments, or management remuneration.
7.2. The Deed of Undertaking & Fiduciary Structure
The Deed of Undertaking is the central enforcement weapon of this structure. It is described as a "sword of Damocles": it hangs over the directors at all times, ensuring absolute compliance. All directors of MRL and MIH are required to sign the Deed of Undertaking in their personal capacity upon Financial Close. By signing, each director formally acknowledges that complying with the First-Pay Obligation is an absolute, non-negotiable fiduciary duty.
Any director who, following the receipt of GEM funds, knowingly approves any corporate disbursement before the Lender's full settlement has been executed is in direct violation of Section 76 of the South African Companies Act — exposing themselves to personal civil liability, criminal charges, and the immediate piercing of the corporate veil.
7.3. The Unconditional Primary Corporate Guarantee
Magni Investment Holdings (Pty) Ltd ("MIH") acts as the Primary Obligor Guarantor — not a secondary surety or a comfort letter provider. MIH formally renounces the South African common law benefits of excussion and division. The Lender has an immediate, direct line of legal recourse to attach MIH's broader balance sheet, assets, and equity value without first exhausting remedies against MRL.
7.4. Regulatory Pre-Approval (SARB Loan Reference Number)
Prior to the initial disbursement of any bridge funds, Core West and MRL's Authorized Dealer bank will apply for and secure a formal Loan Reference Number (LRN) from the SARB Financial Surveillance Department. This LRN formally registers and approves the specific interest rate, tenor, and outward remittance mechanism for the Bridge Facility, rendering the exit mechanism regulatorily frictionless for a foreign Lender.
Section 8
The targeted November 2026 JSE Main Board listing is the singular, critical path event that activates the GEM repayment mechanism for the Bridge Facility. The following timetable represents the definitive regulatory roadmap agreed upon with AcaciaCap Advisors (the JSE Sponsor) and is tracked by the Core West Advisory team on a weekly basis.
The JSE Readers' Panel process for the CPR approval is the singular longest-lead-time item on the critical path. This has been confirmed with AcaciaCap Advisors and the technical preparation for these reports is the primary near-term deployment priority for Allocations 2 and 4 of the Bridge Facility. All other workstreams (legal, audit, marketing) are designed to run concurrently to maximize the probability of the November 2026 target date.
Section 9
No investment is without risk, and Core West has undertaken a comprehensive analysis of all material risk factors. For each identified risk, the structural architecture of this facility has been specifically engineered to mitigate or eliminate the exposure.
| Risk Category | Specific Risk Description | Structural Mitigation Mechanism |
|---|---|---|
| 9.1. Repayment Diversion & Treasury Risk | MRL's management redirects GEM proceeds to operational expenses before settling the Lender's debt, constituting a deliberate First-Pay failure. | The First-Pay Obligation and executed Deed of Undertaking create personal fiduciary liability for all directors under Section 76 of the Companies Act. This is a criminal and civil enforcement mechanism that constitutes an extreme personal risk for any director who attempts a diversion. This structure effectively makes non-compliance not a business decision, but a criminal act. |
| 9.2. Counterparty & Settlement Risk | GEM fails to honour a valid, properly issued Subscription Notice following the JSE listing, creating a gap in the repayment source. | The MIH Unconditional Primary Guarantee immediately crystallizes as a direct obligation upon GEM's failure to perform. Following a 30-day cure period, the Lender is granted full enforcement rights, including forced liquidation authority over MIH's balance sheet and a forced takeover right over 100% of MRL's share capital via the executed Share Pledge. The Lender is also supported by Special and General Notarial Bonds over hard assets permitting immediate attachment. |
| 9.3. Market Volatility & Equity Dilution Risk (Option B) | A post-listing share price decline forces MRL to issue an excessive number of shares to GEM to raise a given dollar amount, potentially exhausting authorized share capital before full repayment. | An Anti-Dilution Floor Price Protection Covenant is embedded into the Option B term sheet. If the 15-trading-day VWAP falls below an agreed threshold, active GEM Subscription Notices are paused. This is simultaneously paired with a mandatory Commercial Refinancing Covenant activation, facilitating the swift identification and closure of an alternative repayment source, supported by EBITDA margins from Makunyula operations of approximately 60%. |
| 9.4. Execution Risk | Unforeseen JSE regulatory hurdles, macroeconomic shocks, or political events prevent or significantly delay the JSE listing beyond the agreed tenor of the Bridge Facility. | Even in a worst-case scenario where the listing is delayed beyond 12 months, the Lender has the right to enforce the full Security Package. The Special and General Notarial Bonds over fully operational, revenue-generating yellow-metal mining equipment and wash plants at Mpaka (Eswatini) and Makunyula (Mpumalanga) permit rapid court-supervised attachment and liquidation to recover principal, with values substantially exceeding the Bridge Facility quantum. |
Section 10
10.1. De-Risked Alpha Generation
This transaction presents an institutional funder with a rare, asymmetrical return profile: the premium yield profile typically associated with distressed M&A and pre-IPO bridge transactions, but structurally secured against a committed multi-hundred-million-dollar institutional equity contract. The Lender does not take on extraction, metallurgical, or commodity pricing risks to achieve their return. The yield is generated from the execution of the Listing and the mechanical drawdown of the GEM facility — decoupling the Lender's IRR from the daily vicissitudes of mining operations entirely.
10.2. Yield Mechanics by Term Sheet Option
| Metric | Option A (Bullet / Floating) | Option B (Quarterly / Fixed) |
|---|---|---|
| Headline Rate | SA Prime (Floating) | SA Prime + 2.00% (Fixed) |
| Approximate Current Rate | ~11.25% p.a. | ~13.25% p.a. |
| Interest Accrual Method | Monthly in arrears, capitalized to principal | Monthly in arrears, settled quarterly |
| Total Interest (12 months) | ~$7 875 000 USD | ~$9 275 000 USD |
| Total Return at Maturity | ~$77 875 000 USD | Principal fully amortized over 12–24 months |
| Repayment Structure | Single bullet at Take-Out Event | Quarterly level-payment installments |
10.3. Liquidity Coverage Ratio
The liquidity coverage ratio (LCR) of this facility exceeds 4.0x, representing a structural overcollateralization not typically found in pre-IPO bridge markets. The $70M debt facility sits below 25% of the $300M primary repayment backstop alone — before any other security layers are considered.
| Security Layer | Value | Coverage Type |
|---|---|---|
| GEM Facility (Primary) | $300 000 000 USD | Contractual / Committed |
| MIH Corporate Guarantee | Full Recourse | Corporate Balance Sheet |
| MRL Share Pledge (100%) | IPO Valuation | Equity / Market Value |
| Hard Asset Notarial Bonds | ~$25M+ USD Est. | Physical / Liquidatable |
| Liquidity Coverage Ratio | >4.0x | Structural Overcollateralization |
Section 11
The securitisation architecture operates as a cascading, four-layer security waterfall. Each layer independently provides full or significant recovery of the Lender's principal, and the layers are cumulative — meaning the Lender holds simultaneous, concurrent rights over all four instruments.
Contractual Primary Security — GEM SSFA Cession: First-Ranking Cession & Pledge over the GEM Facility proceeds. The Lender is functionally securitized by committed institutional U.S. capital — not African mineral extraction.
Corporate Obligation & Fiduciary Enforceability: MIH Unconditional Payment Guarantee as primary obligor, combined with the Deed of Undertaking. This weaponizes the directors' own fiduciary duties against any temptation to divert funds. Non-compliance is legally actionable as a breach of fiduciary duty.
Equity Pledge and Corporate Takeover Right: Perfected Pledge and Cession of 100% of MRL issued share capital held by MIH. Upon the expiry of the 30-day GEM cure period, the Lender assumes total voting control over Magni Resources and can execute a forced M&A sale of the entire group.
Hard-Asset Floor and Physical Recovery: Special & General Notarial Bonds over all yellow-metal mining fleets, wash plants, and fixed infrastructure at Mpaka, Grootvlei, and Makunyula. These assets are attachable and liquidatable entirely independent of corporate or equity performance.
Environmental, Social and Governance (ESG) principles are not merely a compliance checkbox for Magni Resources Limited — they are critical strategic pillars of our corporate finance strategy, fundamental to securing institutional listing capital, maintaining continuous operational licenses, and preserving long-term asset value and community relationships across our multi-jurisdictional footprint.
12.1. Environmental Stewardship
Anthracite possesses significantly lower sulphur and volatile matter content compared to bituminous coal, resulting in materially lower harmful combustion emissions. Furthermore, because anthracite extraction typically occurs on previously disturbed agricultural or industrial land, the environmental impact is significantly reduced and can be managed through comprehensive ecological rehabilitation programmes.
12.2. Social Impact
MRL's asset reactivation and development programme is projected to create approximately 1,000 direct, formal employment opportunities and up to 2,000 indirect livelihoods within the host communities surrounding the Makunyula, Mpaka, and Grootvlei operations. This is critically needed socio-economic relief for the historically under-resourced communities in these regions.
12.3. Corporate Governance
MRL operates under a comprehensive, King IV-compliant governance framework. This framework satisfies the rigorous requirements of institutional investors and underpins MRL's obligations under the JSE Listings Requirements across its South African, Eswatini, and West African operating jurisdictions.
JSE Listing Rationale — Anti-Corruption Commitment
"A primary strategic rationale for the targeted JSE listing is to firmly establish MRL as an entity that actively combats the bribery and corruption historically prevalent within certain segments of the regional mining industry, setting a transparent new standard for ethical resource governance in Southern and West Africa."
Section 13
13.1. Structural Assessment & Funder Viability
Core West Advisory Services Group independently assesses this $70 000 000.00 Pre-IPO Bridge Facility as an exceptionally robust, tier-one private credit opportunity that is highly suitable for institutional and family office funders seeking superior risk-adjusted returns in the private debt market. This assessment is premised on the following structural conclusions: The architecture fundamentally subverts the traditional risk paradigm of junior mining debt. By anchoring repayment exclusively to a committed $300 000 000.00 USD institutional equity facility, the structure removes the single largest risk factor in conventional mining debt — operational execution and commodity price uncertainty. With a Liquidity Coverage Ratio exceeding 4.0x, the facility provides massive structural headroom to absorb severe post-listing market volatility or temporary operational setbacks without in any way endangering the Lender's principal. Four independent and simultaneous security layers — the GEM cession, the MIH corporate guarantee, the share pledge, and the hard-asset Notarial Bonds — provide redundant, concurrent recovery pathways that are unmatched in the junior mining space. The First-Pay Obligation and executed Deed of Undertaking create a legally binding fiduciary compliance mechanism that eliminates management discretion over treasury allocation the moment GEM funds are received, transforming an ethical imperative into a personal legal liability. The SARB LRN pre-approval eliminates regulatory risk from the exit pathway, ensuring the Lender can repatriate capital and yield with zero friction upon the Take-Out Event.
13.2. Strategic Endorsement
The real strategic genius of this transaction is that the Bridge Facility is not merely funding a listing; it is catalytically engineering a transformative valuation event. By utilizing the $70M to acquire the 200MT Makunyula Anthracite Mine and transition it into immediate production, MRL exponentially increases its Day-1 Enterprise Value. A higher enterprise value at listing means MRL issues fewer shares to GEM to generate the same dollar quantum of equity, directly reducing dilution for the Sponsor and simultaneously increasing the structural buffer protecting the Lender's principal. The Lender's capital and the Sponsor's equity are therefore perfectly, incentive-aligned in a shared interest to maximize the JSE listing valuation. Core West Advisory Services Group strongly endorses this transaction structure and management team, and extends a formal invitation to qualifying institutional private debt funds and family offices to engage in detailed due diligence and progress to a final, binding Term Sheet.
Section 14
This Confidential Information Memorandum ("CIM" or "Document") is strictly confidential and has been prepared solely for the use of sophisticated, qualified funders to whom it is directly addressed. By accepting and reading this Document, the recipient unconditionally agrees to maintain the strictest confidentiality with respect to all information contained herein. This Document may not be reproduced, summarized, distributed, passed on, or published, in whole or in part, to any other party without the express prior written consent of Core West Advisory Services Group (Pty) Ltd and Magni Investment Holdings (Pty) Ltd. The recipient further agrees to a binding Non-Circumvention obligation — not to directly or indirectly approach Magni Resources Limited, Magni Investment Holdings, Global Emerging Markets (GEM), or any associated party, bypassing the arranging role of Core West Advisory Services Group.
This Document does not constitute a prospectus, an advertisement, an offer to sell, a solicitation of an offer to buy, or any form of recommendation with respect to any equity, debt, or hybrid securities of Magni Resources Limited (MRL) or Magni Investment Holdings (Pty) Ltd (MIH). Nothing in this Document shall be construed as legal, financial, tax, or investment advice. Any potential transaction emanating from the information herein will be subject to the execution of definitive, binding legal agreements (including a Master Facility Agreement, Deed of Undertaking, and Share Pledge) whose terms, conditions, representations, and warranties shall supersede all information contained in this Document.
Certain information contained in this Document constitutes "forward-looking statements." Forward-looking statements can typically be identified by the use of words such as "targets," "believes," "expects," "aims," "intends," "will," "may," "anticipates," "would," "could," "should," "estimates," "projected," "forecast," or similar expressions. These statements are based on current expectations, estimates, projections, and assumptions made by the Directors of MRL and MIH about the company's business, the industries in which it operates, and the macroeconomic environment. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors which are, in many instances, beyond the control of MRL, MIH, or Core West Advisory Services Group. Actual results, performance, or achievements could differ materially from those anticipated in or implied by the forward-looking statements. Recipients are cautioned not to place undue reliance on any forward-looking statements contained herein.
No representation or warranty, express or implied, is made by Core West Advisory Services Group (Pty) Ltd, Magni Resources Limited, Magni Investment Holdings (Pty) Ltd, or any of their respective directors, officers, employees, agents, or advisors as to the accuracy, completeness, or fairness of the information, projections, or opinions contained in this Document. Prospective Lenders must rely entirely on their own independent investigations, analyses, and due diligence (including, without limitation, legal, financial, tax, technical, and environmental assessments) and must not rely on anything contained in this Document as constituting any representation or warranty on the part of any of the abovementioned parties. Core West Advisory Services Group has, in good faith, compiled this document from information provided by MRL and MIH management and publicly available sources, but accepts no liability for any errors, omissions, or inaccuracies therein.
Core West Advisory Services Group (Pty) Ltd is not a Financial Services Provider as defined by the Financial Advisory and Intermediary Services Act, 2002 (FAIS Act) of South Africa, nor is it a Credit Provider in terms of the National Credit Act (NCA) of South Africa. Core West does not sell, issue, underwrite, market, or give advice on any regulated financial products. Core West's role is strictly that of a Corporate Advisory and Capital Raising Arranger, structuring and presenting this private financing opportunity between the Borrower (MRL / MIH) and a potential institutional Lender. Funders engaging with this opportunity are accordingly required to seek their own independent financial, legal, and compliance counsel prior to committing any capital.
All annexures listed below are available to qualifying funders upon the execution of a formal Non-Disclosure and Non-Circumvention Agreement (NDA/NCA). The index is organized into 14 functional categories to facilitate structured due diligence reviews and legal, financial, and technical verification.
Legal & Security
Corporate & Regulatory Validations
Makunyula Acquisition
Asset Technical Data & Valuations
Business & Financial Modelling
Corporate Governance & KYC
Historical Financials & Tax
Commercial Contracts & Logistics
Environmental, Social, and Regulatory Permitting (ESG)
Human Capital & Management
Counterparty Validation (GEM Take-Out Verification)
Corporate Insurance & Risk Transfer
Current Capital Structure
SepFluor Acquisition
Core West Advisory Services Group
We invite sophisticated, qualified funders to engage in a detailed review of this $70 000 000.00 (Seventy Million US Dollars) Pre-IPO Bridge Facility for Magni Resources Limited. Execution of a Non-Disclosure and Non-Circumvention Agreement (NDA/NCA) is required prior to delivery of all due diligence annexures listed herein.
Core West Advisory Services Group (Pty) Ltd
Corporate Advisory & Capital Raising
South Africa
Magni Resources Limited
20 The Piazza, 1st Floor
Melrose Arch, Johannesburg, 2196
AcaciaCap Advisors (Pty) Ltd
Registration No. 2006/033725/07
20 Stirrup Lane, Woodmead Office Park
Woodmead, Johannesburg
Mazars (Practice No. 900222)
Mazars House, 54 Glenhove Road
Melrose Estate, Johannesburg, 2196