Mustang Geothermal enters $50m financing LOI with German investors

Mustang Geothermal enters $50m financing LOI with German investors Geothermal project site (source: Mustang Geothermal Corp.)
Alexander Richter 23 Jun 2011

U.S. based geothermal development company Mustang Geothermal Corp. entered into letter of intent with ARG Vermögensverwaltung AG of Munich, Germany, on securing funding of $50 million in two tranche fundings of $25 million each.

In a release from yesterday, U.S. based geothermal development company Mustang Geothermal Corp. (OTCBB: URXE) announces that on it entered into a non-binding letter of intent with ARG Vermogensverwaltung AG of Munich, Germany, to arrange for a material definitive agreement securing fifty million dollars ($50 million) in funding to the Company. The terms of the non-binding letter of intent include a proposed two tranche funding of twenty five million dollars ($25 million) each.

The proposed funding is conditioned upon ARG Vermogensverwaltung AG and the Company entering into a Memorandum of Understanding within 30 days and the Company obtaining a trading listing on the Deutsche Borse trading exchange in Germany. After obtaining the trading listing on the Deutsche Borse, and completing the other terms and conditions and normal requirements of due diligence for the Memorandum of Understanding, the Company and ARG Vermogensverwaltung AG will enter into a Material Definitive Agreement to finalize the proposed delivery of the funding to the Company.

Richard Bachman, the President and CEO of the Company stated, “We are excited to begin the funding process with ARG Vermogensverwaltung AG. The Company is determined to use its best efforts to move the process forward and to obtain the trading registry on the Deutsche Borse exchange as soon as possible, and to then complete due diligence and the Memorandum of Understanding to move this forward to completion and obtaining the funding that will fuel our exploratory green geothermal operations and green energy production.”

“ARG is very excited about the prospects of providing Mustang Geothermal fifty million dollars and we look forward to a close relationship,” said a spokesperson for ARG. “At ARG we look for companies that have an impressive and motivated management team and a clear path for capital expansion. ARG sees this as being the case with Mustang Geothermal and therefore we feel we want to be part of this structure from a capital perspective and are interested in pursuing a longer term strategy with whereby ARG has the ability on a first right of refusal for further financing to grow and expand Mustang Geothermal, Inc. beyond its current and immediate plans.”

Source: Company release via PR Newswire