ResCap Investments is a financier to mid-tier producers (and emerging producers) across the breadth of the natural resources industry.
ResCap’s investment strategy focusses on a sector which has been weakened by the withdrawal of traditional financiers due to the highly cyclical nature of the industry. Its investments to date have provided mutually beneficial and constructive finance solutions for counter parties, with blended returns to ResCap, comprising the following:
- Interest income from senior secured debt positions
- Capital gains from ‘equity upside’ (warrants, convertible notes and direct equity investments)
- Income from royalty structures pegged to fresh production
The ResCap senior management team brings a range of cross market skills to each investment opportunity, including significant offtake trading and hedging expertise, strong technical capabilities and deep financial management experience from start-ups through to mature operating businesses. These skill sets provide a practical, hands-on approach to the execution of transactions.
ResCap utilises its own balance sheet in all transactions, and works with a broad range of co-investors as each opportunity requires. ResCap aims to achieve a commercial attractive funding solution for each counterparty which in turn generates the required return hurdles for each co-investor.
Dennis commenced his career in the Australian financial markets in 1983. He was Head of Trading at HSBC Australia until joining Tennant in 1997. He was a principal shareholder of Tennant Metals until 2010, and managing director until December 2014. Dennis would be one of the most experienced physical metal traders in Australia today. His guidance drove Tennant’s excellent reputation for hedging expertise across the base metals complex and later the iron ore markets. He ensured Tennant was an early adopter and participant in iron ore hedging from 2011 onwards.
Over the past 10 years has been involved in various resource investments opportunities which have had marketing rights attached. Dennis holds a Bachelor of Commerce from the University of Cape Town.
Justin commenced his career in the international trade and commodity markets in 1996 after a period in the Royal Australian Army. He had an early stint with Australian National Industries in a project manager capacity before moving on to Brickworks Limited (and its subsidiaries) where he worked in various senior managerial positions for a period of 7 years. These included regional export manager, project manager Western Australia and regional director Middle East, which required a posting to Dubai.
He followed this with a move to Sinosteel Australia in 2006 where he was responsible for the day to day running of the trade desk (Sinosteel is China’s largest trader of iron ore and bulk metallurgical commodities). He joined Tennant Metals in 2008 as its Western Australia general manager, and has been involved in the physical commencement of a number of mining and recovery projects, in Australia, the USA and Asia.
Haydn has an extensive career stretching over 20 years in global investment banking. His areas of expertise cover structured and limited recourse financing of mid and major cap corporates in natural resources and industrials. He has financed assets in Africa, central and SE Asia and Australia across the spectrum of funding markets and structures. Haydn is experienced in public and private corporate reconstructions together with primary and secondary issuance in both equity and debt markets and combines this with significant financial markets structuring and origination experience in commodities, foreign exchange and interest rate markets.
Haydn has worked at Bankers Trust Australia, Investec Bank Australia, RBC Capital Markets and Southern Cross Equities. Haydn’s formal qualifications include a MCom from the UNSW and BEng (mech) from UQ.
WHAT WE DO
ResCap provides first ranking secured debt structures to borrowers.
The debt structures are generally linked to both equity and a component of marketing. The debt is flexible to the extent it will allow for early repayment, and/or a possible subordination within the security ranking in specific events.
The marketing involvement will be specific to situations and can range from pure royalty to an agency style arrangement, as per the borrower's requirements. Physical marketing, hedging and the end sale of commodities are a core competency of ResCap management.
The targeted equity component in any transaction can arise from the issuance/exercise of convertible notes, or alternatively a direct placement of equity or in certain instances issuance of warrants.
ResCap focuses on existing producers or those companies within a maximum of 18 – 24 months to production.