Convertible Loan Raises Questions on Titanium Sands’ Shareholder Approvals and Project Risks
Titanium Sands Limited has locked in a $600,000 convertible loan facility from major shareholders to fund environmental studies and progress its Mannar Heavy Mineral Project. This funding milestone follows recent regulatory approvals and marks a critical step forward for the company.
- Convertible loan facility of $600,000 arranged in two tranches
- Loan carries 10% interest with option to convert into shares and options
- Retentions granted for four key exploration licenses within high-grade zone
- Environmental Impact Assessment process underway following Terms of Reference issuance
- Shareholder approval required for loan conversion securities, with meeting planned for July 2025
Funding Secured to Propel Project Development
Titanium Sands Limited (ASX – TSL) has confirmed a significant funding arrangement that will underpin the next phase of its Mannar Heavy Mineral Project. The company has engaged CPS Capital Group to facilitate a $600,000 loan from its largest sophisticated and professional shareholders. This loan, structured in two tranches of $300,000 each, is designed to support ongoing environmental studies, the Initial Mining License (IML) process, and general working capital needs.
Loan Terms and Conversion Features
The loan carries an annual interest rate of 10%, with repayment due by 30 June 2026. Notably, the lenders have the option to convert the loan principal and accrued interest into fully paid ordinary shares at a price of $0.005 per share. Each converted share will also come with an unlisted option exercisable at $0.023, expiring in mid-2027. This convertible structure provides flexibility for both the company and its investors, aligning interests as the project advances.
Regulatory Progress and Environmental Milestones
Alongside the funding announcement, Titanium Sands highlighted recent regulatory achievements. The Geological Survey and Mines Bureau (GSMB) has granted retentions for four exploration licenses; EL423, EL424, EL425, and EL351; all situated within the high-grade zone identified in the 2023 scoping study. Furthermore, the Environmental Impact Assessment (EIA) process is underway following the issuance of the Terms of Reference in March 2025, a critical step toward securing the necessary environmental approvals.
Shareholder Engagement and Next Steps
The issuance of loan shares and options upon conversion will require shareholder approval under the Corporations Act and ASX Listing Rules. Titanium Sands plans to convene a general meeting in July 2025 to seek this approval. CPS Capital, as lead manager, will receive fees and options as part of the arrangement, reflecting standard market practices for such transactions.
Strategic Implications
Managing Director Dr James Searle emphasized the significance of these developments, noting that the combination of funding, regulatory progress, and environmental studies represent jointly important milestones. The secured funding not only provides financial runway but also signals confidence from major shareholders in the project’s potential. As the company moves toward finalising environmental approvals and advancing mining licenses, these steps will be closely watched by investors and industry observers alike.
Bottom Line?
With funding secured and regulatory milestones achieved, Titanium Sands is poised to advance its Mannar project, but shareholder approvals and environmental outcomes remain pivotal.
Questions in the middle?
- Will shareholder approval for loan conversion securities be secured smoothly at the July meeting?
- How will the Environmental Impact Assessment outcomes influence project timelines and costs?
- What are the company’s plans for further funding beyond June 2026 repayment date?
