Small investment, huge profit? When financing truly pays off: Almonty, T-Mobile US, Netflix

Base Shelf Prospectus offers Almonty flexibility

The Base Shelf Prospectus allows a company to access various forms of financing within a predefined period of 25 months. The advantage: once registered, there is no need for repeated applications and lengthy approval procedures. As soon as there is a need for financing, a simple prospectus supplement containing the exact terms of the financing offer is sufficient. Once approved, Almonty can offer equity, debt, or hybrid instruments. The Base Shelf Prospectus may include voting common shares, preferred shares with limited or no voting rights, debt securities such as bonds, warrants, subscription rights, or combinations of these instruments. Above all, the combination of different instruments allows companies to optimize their capital structure - for example, to minimize dilution or create additional incentives for investors.

Sangdong mine to become a cash cow – Further lucrative investments conceivable

In the context of the latest company announcement, Almonty mentions the ramp-up of the Sangdong mine, which is scheduled to go into production this year and be expanded immediately, but the Company has further investment opportunities. Possibilities include expanding the Panasqueira mine in Portugal and resuming tailings processing in Los Santos, Spain. A few weeks ago, Almonty also indicated on Bloomberg that it intends to acquire a tungsten project in the US. In a TV interview with CNBC on Wednesday, Almonty CEO Lewis Black spoke again about these plans. The greatest leverage comes from the already decided rapid expansion of production in Sangdong, where a doubling of production volume is planned within the first two years. As the price of tungsten has risen significantly in recent years and is now well above the level calculated in feasibility studies, Almonty could become a cash cow. However, the purchase of additional deposits would also be attractive – after all, Almonty is considered a technology leader in the field of tungsten. In recent interviews, Black said he believed his company was 10 years ahead of its Chinese competitors in terms of efficiency. Leveraging this expertise to develop new deposits and raising capital for such projects is likely to pay off handsomely.

T-Mobile US and Netflix with capital measures: money well invested in retrospect

Historical examples show that capital measures can create significant opportunities for companies: in 2020, T-Mobile US announced the issuance of bonds totaling USD 19 billion to finance its acquisition of Sprint. Since then, T-Mobile US has become an industry leader, growing faster than ever. After refinancing, the interest burden fell - a move quickly rewarded by improved credit ratings. Netflix has also used debt capital profitably in the past. At the end of 2019, its budget for original content was a staggering USD 15 billion per year, financed through bonds. Today, despite growing competition, Netflix remains the undisputed global market leader in streaming. And the stock? It has more than tripled since early 2020. Investing in content at the right time clearly paid off for Netflix.

Will Almonty become a global player? CEO and investors in the same boat

Which capital measures truly pay off for shareholders? The answer lies in the smart use of financing. When a business model is sustainable, capital increases or bond issues can have a multiplier effect. Through its strategic investments, Netflix has built up an enormous customer base that justifies a high company value despite high debt. T-Mobile grew through its merger with Sprint into a company with strong fundamentals and solid operating performance.

Smart investments could help Almonty further expand its unique market position and seize the opportunity in times of sharply rising tungsten prices. Further investments in processing capacities or future-oriented assets are likely to deliver lasting returns. With CEO and founder Lewis Black holding a significant stake in the Company, management and shareholders are clearly aligned. Investors and analysts alike will be watching closely how Almonty utilizes its newly filed Base Shelf Prospectus. The market for critical metals is evolving rapidly, and Almonty is among the best-positioned players to capitalize on it.