First Phosphate Corp. (CSE:PHOS, NASDAQ:PHOS, FRA:KD0, OTCQX:FRSPF) earlier this week highlighted Swiss government support for financing linked to its Bégin-Lamarche mine, as CEO John Passalacqua outlined the company’s efforts to assemble a capital stack designed to limit shareholder dilution.
Proactive: Really big news out from the company today. It really jumps off the page: a guarantee of $212.5 million for CapEx for First Phosphate, coming from the Swiss government. Tell me a little bit about this, John.
John Passalacqua: Yeah, so this is the Swiss government that’s guaranteeing up to 85% of exports from Switzerland that are aimed towards the mine at Bégin-Lamarche. So you’ve got a very nice debt-to-equity ratio there. 85% is almost unheard of in the industry. And it’s obviously based on the credibility of the mine, based on the fact that we’ve been endorsed by the G7, based on the fact that we have other export credit agencies at the table.
EIFO from Denmark was there already, if you remember, for €170 million. So little by little, we’re putting together the whole capital stack here for the project, which can be done quite non-dilutively.
And that’s a key to this because they’re looking at about 85% of the cost, and potentially more if that happens. But it does get to the point where your shareholders are very well protected here.
Exactly. And that’s the real aim here: start early in building a capital stack. Start building it with credible partners, nation states that want to see your success, staying away from the higher-priced and obviously toxic capital. This is friendly capital. It’s capital that wants to see you succeed and is great for our shareholders.
It just points to less dilution down the road, which is what everyone’s concerned about in mining projects.
So, John, maybe you could talk to me a little bit about this news release coming out on a day when there’s going to be a number of leaders and government people that you’ll be talking to about something like this.
Yeah, so today is the Canadian Investment Summit put on by Prime Minister Mark Carney. And so the release comes out at the perfect time, and it just shows the support from the Swiss government towards Canada and towards First Phosphate as well.
And lastly, John, you mentioned Denmark, you also mentioned the Swiss government. Now it’s really showing where the project is at and really where it wants to go and the support behind it. This puts you ahead of a lot of your peers, right?
Exactly. I mean, it shows that Europe is very much behind the project. Europe is very much attuned to phosphate. It really needs the high-purity igneous phosphate for its own internal purposes. And it just cements the transatlantic partnership that there is between Canada, USA and Europe.
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