In late March 2018, Element ASA (Element) and Alpha Blue Ocean (ABO) agreed to improve the terms of a convertible loan facility that had initially been agreed upon in October 2017. Under the initial agreement, the loan facility totalled up to NOK 50 million with warrants attached. However, in the months following, the terms were amended and subsequently, the Board of Element subscribed for five final tranches of the loan that amount to NOK 25 million.
The amendment to the terms was reflected in the improvement of the conversion price. The pricing period remained untouched, as did all other terms relating to the original convertible loan facility agreement. Alpha Blue Ocean can convert the notes into new shares at any time provided various regulations have been followed. However, the notes can also automatically convert into shares 12 months after Element receives the NOK 25 million consideration.
Element Chairman Lars Christian Beitnes was particularly happy to have secured the funding needed for the company’s investment in Ambershaw Metallics Inc. (Ambershaw) by the middle of June 2018. He was also happy about the trust and commitment that Alpha Blue Ocean had shown towards the firm. His sentiments were echoed by Chief Executive Officer (CEO) Cecilie Grue, who was optimistic about continued cooperation between Element and ABO.
Alpha Blue Ocean CEO and Founder Pierre Vannineuse showed satisfaction at what Element had accomplished and how it had exceeded all expectations. He was convinced that with a significant portion of the loan facility secured, Element would continue its investment in Ambershaw and other significant projects. Mr. Vannineuse is also the head of the European High Growth Securitization Fund (EHGO).
As ABO’s founder, Mr. Vannineuse has been instrumental in helping the firm’s growth as a provider of much-needed financing for highly innovative technologies. The company specialises in providing debt and equity financing to publicly-listed companies across the globe, all while remaining non-invasive in its operations. ABO has financed companies in sectors such as energy, mining, healthcare and technology.
Element ASA is a project investment company that operates in the mineral sector where it focuses on projects that make use of new and ground-breaking technology. The firm has continually strived to create as much value for its shareholders as possible while exposing them to minimal risk. Doing this requires identifying undervalued projects that have the greatest potential from an environmental, management and financial perspective.
Among the investments that Element has is Ambershaw Metallics Inc., where it owns 26.74% of shares. This investment is driven by the latter’s main asset: a magnetite deposit in Bending Lake, Ontario, Canada. Element funds the operations of Ambershaw, which translates into increased shareholding over time. The magnetite deposit has been explored since 1953 and sits in a region that has good road infrastructure, access to a railroad yard and is 310 kilometres away (via road) from Port of Thunder Bay on Lake Superior.
Another project that Element is involved in revolves around the development of blockchain technology. Specifically, the firm has signed a Terms of Agreement (TOA) with Harmonychain to explore the issuing of asset-backed tokens backed by Element’s reserves in nickel and iron ore. The tokens will be based on blockchain technology and can be used as an investment tool for investors looking to get into digital tokens that have underlying security.
Many international companies have considered the possibilities that digital currencies offer. Through the tokens, Element could have an interest-free financing avenue that allows it so sell future production in advance. The use of token and blockchain technology also provides a secure transaction structure for organisations.