Cat Financial Helps LHG Mining with Significant Expansion Project

Cat Financial helps LHG Mining finance 37 machines with various parts and attachments.

Barry Stevenson

Creative Coordinator

Cat^® Expansion Financing Case Study

CUSTOMER:

LHG Mining

INDUSTRY:

Mining

SOLUTION:

Financing

LOCATION:

São Paulo, Brazil

DEALER:

Sotreq

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A Cat Financial Customer Story

J&F Investimentos S.A. maintains a robust investment portfolio and a reputation for expansion and success in new sectors. Willian Ozorio Dias, a Corporate Finance Manager at LHG Mining, highlighted the company's adaptability: "I think it's really in the DNA and in the history of the J&F group to enter segments where it did not have knowledge and where we succeeded."

In 2022, J&F diversified even further by acquiring Mineração Corumbaense Reunida S.A. (MCR) and formed LHG Mining. The relationship with Cat Financial and their local dealer, Sotreq S.A. (Sotreq), was crucial during this transition, and the company experienced rapid growth in its first couple of years of operation.

As LHG Mining began a significant expansion project, it needed advanced and reliable mining equipment and financing to match. Faced with a wide range of options, it chose Sotreq and Cat Financial because of their deep industry knowledge and ability to provide customized financing solutions that aligned with LHG Mining’s vision for the future.

Tailored Solutions For Unique Needs

LHG Mining’s relationship with Cat Financial and Sotreq comes with Flexible Financing Solutions that empower them to reach their full potential. Cat Financial brought their industry expertise to help navigate difficulties like market fluctuations and regulatory demands.

Ozorio Dias explained the rationale behind the decision: "Cat Financial brought very simple solutions to us, here in our business, and very quickly. Both structuring the line of credit, as well as bringing information related to the mining industry.

Enhanced Operational Efficiency

Cat Financial, known for its specialized knowledge in the mining sector, has been a key collaborator with LHG Mining as it continues to expand. Their experienced team helped build a financing plan that meets LHG Mining's financial and operational needs.

Raimundo Daniel, Mining Operations Manager at LHG Mining, shared insights into how the customized financing plan has benefited their operations: "They helped us in determining the size of the fleet, with the acquisition and the development of the mine. So, in six months we were able to get the large machinery operating."

Collaborating like this helps make operating the mine sites more productive and effective.

Daniel further added, "The relationship between Sotreq and LHG Mining is extremely important for the process, from the reliability of the maintenance of all the machinery as well as technical support in relation to the training, qualification and development of our operations team."

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Driven Growth With Proven Results

LHG Mining is tracking an ambitious growth trajectory, with Cat Financial playing an instrumental role in their journey.

Roberto Ricciardi, International Account Manager for Cat Financial, comments on their potential: "LHG has a plan for growth which is very aggressive. Based on the values we have in common, Cat Financial is ready to adapt and develop new solutions that will be needed in the future."

In the past two years, LHG Mining has increased its production from 2 million tons of iron ore per year to more than 8 million tons and working with Cat Financial ensures that it will remain agile and competitive in a rapidly evolving industry.

Ricciardi added, "It is a unique solution developed specifically for them. We hope that this will ensure longevity and new operations as well as the supply of Caterpillar machines to the client."

The opportunity for Cat Financial to support LHG Mining with a customized line of credit and in-depth market analysis highlights the essential role of industry-specific financial solutions in achieving long-term success. This relationship offers vital strategies to empower others in the industry to optimize operations, reduce risk, and accelerate their growth and profitability, as LHG Mining did.

Reflecting on the company's focus on innovation and growth, Pablo Costa, Corporate Finance Director for LHG Mining, stressed the importance of their mission in guiding future efforts: "We have a very clear goal, which is to be able to supply this high-quality ore that

we have there in Corumbá, in Mato Grosso do Sul, throughout the country and around the world."