Sirius Minerals share price: MP calls on government to support mine
The fertiliser development company is running out of cash fast and with it unclear if it will get its $500 million bond offering done in September, a local lawmaker has urged the government to step in.
Sirius Minerals cancelled its $500 million bond sale in early August, sending its shares plummeting more than 30% and casting doubt over its ability to build its fertiliser mine in Yorkshire.
With investors growing concerned that company will run out of cash before its attempts it bond issuance for a second time in late-September, a local MP has called on the government to finance the mine project.
Local MP tells government to ‘put its money where its mouth is’
Stockton North Labour MP Alex Cunningham has urged the UK government to guarantee funding for the mine and Teeside fertiliser plant, which is expected to create more than 2,000 jobs.
The local lawmaker told the government to ‘put its money where its mouth is’ and back Sirius Minerals' project after the business announced that it has just weeks until its cash reserves dry up.
‘If the Prime Minister is serious about the Northern Powerhouse then backing Sirius Minerals is a must,’ Cunningham said in a letter to the Business Secretary Andrea Leadsom. ‘He should put his money where his mouth is and provide a package of financial and infrastructure support to the company.’
‘This project is about the future economic prosperity of the Tees Valley as a whole, the Government must do all it can to ensure it continues to be delivered by the set timescales,’ he added.
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Bond issuance vital to unlocking JP Morgan credit line
Sirius Minerals told investors that it was forced to suspend its $500 million bond issuance ‘due to market conditions’.
The success of its bond offering is vital to the company unlocking a further $2.5 billion via a revolving credit facility from US-based investment bank JP Morgan.
If it is unable to secure the necessary funding it needs before the end of September, the company is at risk of running out of money and forced into administration or liquidation.
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