Resolute Mining Ltd (ASX:RSG) has executed documentation for a new flexible low-cost syndicated loan facility with a maximum limit of US$300 million.
The facility will refinance the US$63 million secured project loan facility provided by Taurus Funds Management Limited for the initial construction of the Mako Gold Mine in Senegal, as well as replace US$195 million of existing senior bank debt facilities.
It also comprises a three-year US$150 million revolving credit facility and a four-year US$150 million term loan facility.
“Simple low-cost” debt package
Managing Director and CEO John Welborn welcomed the endorsement received from six of the world’s leading mining finance banks and was pleased to have secured flexible, low-cost funding in the currently challenging times.
“I thank our world-class banking syndicate for their appreciation of the fundamental strength of our business.
“We now have a simple low-cost flexible senior debt package which reduces our borrowing costs, provides immediate liquidity and will provide important flexibility for the funding of future growth initiatives.
“We expect the undrawn capacity of the Facility to increase during 2020 as we generate positive cashflows from Syama and Mako and pay down debt and look forward to working with our banking group to create further value for our shareholders.”
Drawdown to occur March 23
Drawdown under the facility is expected to occur during the week beginning March 23 and is expected to be drawn to US$250 million to enable the complete repayment of the Mako project loan facility.
The refinancing of the Mako project loan follows Resolute’s agreement to acquire the related project royalty over Mako in January 2020 and the complete repayment of the US$130 million acquisition bridge facility in February 2020.
Mako will form part of Resolute’s overall security package for the syndicated loan facility and will have no external royalty or independent encumbrance.