Amaero secures $23.5 million loan from Export-Import Bank of USA

Amaero Advanced Materials & Manufacturing Inc., a wholly-owned US operating subsidiary of Amaero, has secured a US$23.5 million loan from the Export-Import Bank of the United States (EXIM). Amaero International Limited is a domestic US producer of high-value C103, refractory alloy, and titanium powders for additive and advanced component manufacturing.

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The US federal government export credit agency will provide capital equipment financing and will directly fund the loan as part of EXIM’s Make More in America initiative (MMIA) that was established “to address the longer-term weaknesses in our nation’s supply chains, the result of decades of underinvestment, outsourcing, and offshoring instead of investment in long-term security, sustainability, and resilience. Too many American manufacturers in sectors critical to America’s national security, especially small- and medium-sized enterprises struggle to obtain financing … EXIM is well positioned to address this issue while supporting jobs in America.”

Amaero’s loan is the sixth MMIA loan to be approved by EXIM’s Board of Directors and the first MMIA loan that supports advanced materials and additive manufacturing. Amaero’s business is positioned at the nexus of strategically important US policy initiatives that include enhancing the resiliency and scalability of manufacturing and supply chain capabilities. EXIM’s loan provides a demonstrable commitment by the US government that reaffirms the strategic importance of Amaero’s capabilities to national security and economic vitality. With the commissioning of the first advanced atomizer and with ordering the second and third advanced atomizers, Amaero is positioned to be the largest US domestic manufacturer of C103, refractory, and titanium alloy powders that are essential to the additive manufacturing of mission-critical components for the space and aerospace sectors. Moreover, Amaero is well-positioned to export US-produced advanced materials.

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The loan reflects a 75% loan-to-cost on capital equipment that has been or will be installed in Amaero’s manufacturing and corporate headquarters in McDonald, Tennessee. The loan is expected to be drawn over five quarters beginning the fourth quarter of FY2025 and the loan terms include a precedent condition that requires Amaero to complete a capital raise prior to the first draw. The loan has an initial 12-month period of interest-only payments, followed by fully amortizing principal and interest payments over seven years. The cost of capital for the loan, inclusive of the interest rate and amortization of fees, is estimated at approximately 6.95% per annum and the interest rate will be locked at the time of closing.

Amaero International Limited will be the guarantor of the loan. EXIM will receive a first-priority security interest on the equipment financed by the loan. Initially, Amaero will maintain an interest-bearing cash collateral account with EXIM or a correspondent bank equal to 20% of the outstanding principal balance. Upon achieving cash flow from operations that equals or exceeds 1.2x debt service coverage (DSC) for two consecutive quarters, the cash collateral account will convert to a sinking fund with future principal and interest payments debited from the account until the cash balance is exhausted. The loan documentation will reflect customary financial covenants, including liquidity and leverage ratios.

“This is a very important milestone event for Amaero. Non-dilutive, US government-funded support is an important signal to the market that validates the alignment of Amaero’s strategy and capability with the United States’ priority policy initiatives. Equipment financing has been secured approximately 12 months ahead of guidance and with an attractive interest rate. Amaero has intentionally pursued a corporate strategy that addresses critical gaps in US domestic manufacturing and supply chain capabilities. Improving the resiliency and scalability of domestic manufacturing throughput is an imperative for both national security and economic prosperity. After decades of offshoring manufacturing to lower-cost countries, the United States has atrophied domestic manufacturing capability, has created critical vulnerabilities in domestic supply chains, and has lost approximately 7.1 million skilled, highly-paid manufacturing jobs,” said Hank J. Holland, CEO and Chairman of Amaero. “We have worked closely with EXIM since January 2024 and are gratified that the loan has received final and unanimous approval from EXIM’s bipartisan Board of Directors. As customary with Amaero’s practice, the Company waited for final approval before disclosing the EXIM transaction. The EXIM loan provides important enabling support to Amaero. The company expects to invest approximately $50 million into capital equipment and facility improvements and to support an estimated 150 skilled, highly-paid US jobs.”