SerenOx Sulphuric Solutions — Funding Requirement & Use of Proceeds
SerenOx requires total project funding of ZAR 450 million (~USD 24 million at ZAR 18.75/USD) to finance the construction of the manufacturing facility, establish logistics infrastructure, fund initial working capital requirements, and provide an adequate contingency buffer for unforeseen cost escalation.
Section 12 · Business Plan
Funding Requirement & Use of Proceeds
SerenOx requires total project funding of ZAR 450 million (~USD 24 million at ZAR 18.75/USD) to finance the construction of the manufacturing facility, establish logistics infrastructure, fund initial working capital requirements, and provide an adequate contingency buffer for unforeseen cost escalation.
(~USD 24 million) funding the plant, infrastructure and working capital, with a 4.2-year simple payback and dividends commencing in Year 3.
12.1 Total Capital Requirement
SerenOx requires total project funding of ZAR 450 million (~USD 24 million at ZAR 18.75/USD) to finance the construction of the manufacturing facility, establish logistics infrastructure, fund initial working capital requirements, and provide an adequate contingency buffer for unforeseen cost escalation.
12.2 Funding Structure
| Funding Source | Amount (ZAR m) | % of Total | Terms |
|---|---|---|---|
| Equity — Founders | 135 | 30% | Ordinary shares; no preferential rights |
| Equity — Strategic Investor (SMH) | 90 | 20% | Ordinary shares; board representation |
| Equity — New Investors | 45 | 10% | Ordinary shares; tag-along/drag-along rights |
| Project Finance Debt | 180 | 40% | Prime + 2.5%; 7-year tenor; 12-month grace |
| TOTAL | 450 | 100% |
12.3 Use of Proceeds
| Use of Funds | Amount (ZAR m) | % of Total | Timeline |
|---|---|---|---|
| Plant & Equipment | 250 | 55.6% | Months 4–16 |
| Utilities & Infrastructure | 70 | 15.6% | Months 3–14 |
| Working Capital | 50 | 11.1% | Months 16–24 |
| Logistics & Bonded Terminal Setup | 25 | 5.6% | Months 6–15 |
| Contingency & Pre-Export Contracts | 55 | 12.2% | Throughout |
| TOTAL | 450 | 100.0% |
12.4 Investor Value Proposition
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Targeted IRR of 18–22% on equity investment, based on conservative base-case assumptions
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Dividend distributions commencing in Year 3, with a target payout ratio of 30–40% of net profit
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Exposure to high-growth DRC mining sector with significant upside from expanding EV battery supply chains
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Asset-backed investment with tangible industrial plant, equipment, and inventory
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Strong B-BBEE credentials providing preferential access to government contracts and incentives
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Experienced management team with proven track record in industrial chemicals and mining supply chains
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Clearly defined exit mechanisms including strategic sale, management buyout, or IPO (3–5 year horizon)
12.5 Exit Strategy
Investors will have access to multiple potential exit pathways, including trade sale to a strategic acquirer (major chemicals producer or mining conglomerate), secondary sale to a private equity or infrastructure fund, management-led buyout facilitated by retained earnings and debt refinancing, or listing on the JSE’s AltX or main board within 5–7 years, subject to scale and market conditions. Shareholders’ agreements will include standard tag-along, drag-along, and pre-emptive rights to protect minority investor interests.
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