LONDON (Alliance News) - London Mining PLC Wednesday said it has entered a new USD25.0 million debt facility with Standard Chartered Bank and FirstRand Bank, securing additional short-term working capital for the company.
In a statement, London Mining said the facility matures on November 30, but can be extended to the end of December in the event of "certain" circumstances. The company said that the interest margin of 8.5% and arrangement fee are in line with its existing secured debt facility. In addition, it has agreed to pay a further USD3.5 million in fees.
The first USD1.0 million must be paid when the facility matures, while the remainder must be paid upon completion of London Mining's process to secure an investment by a strategic partner to reduce debt and fund future capital expenditure.
On Wednesday, London Mining said that process is progressing, with non-binding indications of interest received from a number of industry parties, who have performed due diligence on a range of potential structures for the investment. London Mining, which said it is confident of the process being concluded before the end of 2014, is being advised by Goldman Sachs International and Standard Chartered Bank.
As part of the new debt facility arrangements, London Mining has granted FirstRand Bank warrants over 2.8 million shares, representing 2% of the existing share capital, plus additional shares if it issues any new shares during the period.
"The warrants have an exercise price equal to the nominal value of the shares and a three year warrant exercise period and are subject to normal anti-dilution provisions," London Mining said.
London Mining's shares were Wednesday quoted up 0.8% at 33.50 pence.