- Export Development Canada credit facility to support the
construction and commissioning of Neo's new sintered magnets
facility in Europe.
- Phase One construction of the manufacturing facility is
proceeding on time and on budget and is expected to have a
production capacity of 2,000 metric tons per year.
TORONTO, Nov. 4, 2024
/CNW/ - Neo Performance Materials Inc. ("Neo" or the
"Company") (TSX: NEO) is pleased to announce it has entered
into a loan agreement ("Loan Agreement") with Export
Development Canada ("EDC") for a term loan of up to
US$50 million (the "Credit
Facility") to finance the on-going construction of the sintered
magnets facility in Narva, Estonia
(the "Project").
Highlights of the Credit Facility:
- The Credit Facility of up to US$50
million will be advanced in two tranches of US $25 million and will mature five years from the
date hereof.
- Principal repayment will begin two years from the date
hereof.
- The outstanding principal amount carries an interest rate equal
to the secured overnight financing rate, as administered by the
Federal Reserve Bank of New York,
plus an applicable margin.
- Several of the Company's subsidiaries, including the entity
that owns the Project, are expected to provide guarantees and/or
security in favour of EDC pursuant to the Loan Agreement.
Neo will use the Credit Facility to advance its new sintered
magnets manufacturing facility in Narva, Estonia, which is expected to be completed in
2025. Strategically located near Neo's existing rare earth
separation plant, Phase One of the new facility's operations is
expected to produce 2,000 metric tons per year, with plans for
future growth. Sintered magnets are critical to fast-forwarding the
green transition. They are used in applications such as traction
motors for electric vehicles and generators for wind turbines.
Initiated in 2023, the construction is progressing on time and
on budget, with an estimated cost of US$75
million. The facility has obtained significant support,
including a grant of up to US$20
million (€18.7 million) from the European Union's Just
Transition Fund ("JTF") in 2022. As of the first half of
2024, Neo has capitalized US$24.9
million since the project's inception. The remaining
estimated cost of US$50.1 million
(prior to the JTF grant) is anticipated to be spent through the end
of 2024 and into 2025.
"Neo is pleased to have EDC's support to advance our new
sintered magnets manufacturing facility. Strategically located in
Estonia to support the
mid-to-downstream integration with our Silmet rare earth separation
facility, this manufacturing facility will be Neo's first to
produce made-in-EU rare earth magnets for electric vehicle traction
motors. It will service the growing demand for localized, parallel
supply chains, shaping the future of EV manufacturing in
Europe and North America," said Rahim Suleman, Neo's President and Chief
Executive Officer.
Cautionary Statements Regarding Forward-Looking
Statements
This news release may contain "forward-looking information"
within the meaning of applicable Canadian securities legislation.
Generally, but not always, forward-looking information and
statements can be identified by the use of words such as "plans",
"expects", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "believes" or the
negative connotation thereof or variations of such words and
phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved" or the negative connotation thereof. Specific
forward-looking statements in this news release include, but are
not limited to, construction and commissioning of the Project,
budgets, expenditures, and costs associated with the completion of
the Project, issues relating to timing of product qualification,
and matters relating thereto. In making the forward-looking
information in this news release, the Company has applied certain
factors and assumptions based on its current beliefs and
assumptions made by and information currently available to the
Company. Although the Company considers these assumptions to be
reasonable based on information currently available to it, they may
prove to be incorrect, and the forward-looking information in this
release is subject to numerous risks, uncertainties, and other
factors that may cause future results to differ materially from
those expressed or implied in such forward-looking
information. There are many risk factors associated with the
completion of the Credit Agreement, security agreements and the
Project. Several factors could cause actual results to differ
materially from those anticipated by the Company, including but not
limited to the risks and uncertainties inherent in the nature of
the construction and commissioning of a manufacturing facility,
including the failure to obtain necessary regulatory approvals or
to otherwise complying with applicable building permits, risks
relating to qualification of products, risks of a material adverse
change the Company's assets or revenues, or risks of unknown
liabilities that may arise.
Readers are cautioned not to place
undue reliance on forward-looking information. The Company does not
intend and expressly disclaims any intention or obligation to
update or revise any forward-looking information, whether as a
result of new information, future events, or otherwise, except
as required by law.
For more information on Neo, investors
should review Neo's continuous disclosure filings,
which are available under Neo's profile at
www.sedarplus.ca.
About Neo Performance Materials
Neo is fast-forwarding the green energy transition by
manufacturing the building blocks of many modern technologies that
enhance efficiency and sustainability. Neo's advanced industrial
materials - magnetic powders and magnets, specialty chemicals,
metals, and alloys - are critical to the performance of many
everyday products and emerging technologies. Neo's products help to
deliver the technologies of tomorrow to consumers today. Neo's
business is organized into three divisions: Magnequench, Chemicals
& Oxides, and Rare Metals. Neo is headquartered in Toronto, Ontario, Canada, with corporate
offices in Greenwood Village,
Colorado, United States;
Singapore; and Beijing, China. Neo has a global platform that
includes 10 manufacturing facilities in China, the United
States, Germany,
Canada, Estonia, Thailand and the United Kingdom, and one dedicated research and
development centre in Singapore.
For more information, please visit www.neomaterials.com.
SOURCE Neo Performance Materials, Inc.
