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September 17, 2018

Mercuria to invest $650m in Mesabi iron ore project

Swiss commodity trading firm Mercuria Energy has signed a memorandum of understanding (MOU) to provide a $650m financing package for US-based iron ore producer Mesabi Metallics Company.

Swiss commodity trading firm Mercuria Energy has signed a memorandum of understanding (MOU) to provide a $650m financing package for US-based iron ore producer Mesabi Metallics Company.

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The financing packaging will fund the completion of Mesabi’s 7mtpa mine-to-plant pelletisation project in Minnesota and support job creation and economic growth in Nashwauk, Itasca County and Minnesota’s Iron Range.

“Mercuria plans to employ the highly-skilled workforce in Minnesota, as we do elsewhere in America and internationally.”

The injection of funds will help accelerate the engineering, procurement and construction of the project.

In exchange for the investment, Mercuria will acquire a majority stake in Mesabi, which is a wholly-owned subsidiary of Chippewa Capital Partners (CCP).

Mesabi’s mineral lease rights were reinstated in July this year after meeting key milestones.

Mercuria Energy CEO Marco Dunand said: “Today’s announcement is part of Mercuria’s ambition to further expand and invest in the US, playing a greater role in increasing American production capacity, and indirectly supporting the strategic steel sector, which is resurging as the US economy is showing even more robust growth.

“Pursuant to this investment, Mercuria plans to employ the highly-skilled workforce in Minnesota, as we do elsewhere in America and internationally in all the ventures that Mercuria operates and bring more efficiency to markets and create reliable alternative physical supply solutions to clients.

“Specifically, the Mesabi investment demonstrates our confidence that – with greater financial strength and stability – Mesabi Metallics can re-emerge as a significant player in the North American pellet and value-added product market segment.”

The company is planning to complete the proposed investment following the closure of the acquisition in the fourth quarter of this year.

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How attractive are current investment opportunities in Europe?

Europe has been identified as one of the most favorable regions for investors, seeing high investment activity in the past year. Most of these investments have been through Debt Offering, valued at close to $700 billion. The region has provided attractive investments in a diverse set of companies. Companies who tend to major themes such Digital Media, Cloud, Artificial Intelligence, E-commerce, and Big Data are recording the highest number of deals, with Digital Media recording close to 2,000 deals. However, GlobalData’s whitepaper offers a full view of the market, analyzing less successful or attractive points of investment as well, examining statistics on Equity Offering investments and PE/VC deals. Understand how government agencies for economies around the world use GlobalData Explorer to:  
  • Track the M&A and Capital Raising volumes into their target market
  • Identify the top sectors in the target market attracting the investments
  • For any investment segment, identify the top Investors inside and outside the target economy that are already investing in the Segment
  • Assess and showcase the growth potential for various Industries in the target economy
Don’t miss out on key market insights that can help optimize your next investment – read the report now.
by GlobalData
Enter your details here to receive your free Report.

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