The Latrobe Magnesium Limited (ASX: LMG) share price is in the red today following a loan facility announcement.
Shares in the magnesium company fell as low as 9.6 cents today after opening at 11 cents. At the time of writing, they've clawed back some ground to 9.9 cents, down 5.71%
The company is developing a magnesium production plant with a patented extraction process in the Latrobe Valley, Victoria.
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What did Latrobe announce today?
Latrobe has signed off on a $23 million loan to construct the magnesium production plant. The total cost of the build is $39 million.
The company revealed it now has the funds available to completely pay for the construction of the plant.
Interest on the company's loan will be charged at 14% per annum up to October 2023 before increasing to 16% to December 2024, with a final capped rate of 24% from January 2025. The term of the loan is five years.
Latrobe hopes to showcase how its hydromet technology can extract high-quality magnesium and other by-products.
The company intends to conduct a pre-feasibility study during 2022 using ferro nickel slag feedstock.
As reported by Motley Fool Australia, the Latrobe share price surged in early trade yesterday after the company secured a property with several buildings to house the production plant.
The deal, worth $4.5 million, will include a combination of a $2.25 million cash payment and the issue of shares to the property's former owner, the Di Fabrizzio family.
Latrobe share price snapshot
The Latrobe Magnesium share price has gained more than 438% in the past 12 months, rallying 321% this year to date.
Although the company's shares dived 39% in the last month of trading, they've gained 26% this past week.
The company has a market capitalisation of about $151 million, based on the current share price.
