West African gold mining company Aureus Mining has signed two major loan facilities with South African financial institutions to finance its New Liberty gold project in Liberia.
The deal includes a US$ 88 million six year project finance loan facility agreement with South African banks Nedbank and Rand Merchant Bank (RMB), as well as a six and a half year subordinated loan facility agreement for US$ 12 million with RMB Resources. located within the Southern Block of the Company’s 100% owned Bea Mountain Mining licence in Liberia. The first finance loan facility will be supported by Export Credit Insurance Corporation of South Africa (ECIC), which provides political and commercial risk coverage for Nedbank and RMB.
This financing transaction was the winner of the prestigious Development Funding Deal of the Year award at the Mines & Money Conference in London on 4 December 2013.
“The signing of the project finance loan facilities to finance New Liberty is the final key step in Aureus’ strategy of building Liberia’s first commercial gold mine. We have a very compelling debt package which has an overall interest cost of c.6%. We are delighted to welcome and look forward to working with Nedbank, RMB, ECIC and RMB Resources as key partners in providing the debt component for the New Liberty Project and we expect this to be a significant step in harnessing Liberia’s potential in becoming West Africa’s newest gold district,” says David Reading, President and CEO of Aureus Mining.
For the purposes of the US$ 88 million project finance loan facility agreement, Nedbank acted through its Nedbank Capital division and Rand Merchant Bank is a division of FirstRand Bank. In respect of the US$ 12 million subordinated loan facility agreement, RMB Resources is a division of FirstRand Bank (London Branch). Nedbank, RMB, RMB Resources and ECIC are leaders in African mining finance and their teams bring a wealth of experience in mining and metals and financing of projects, with complementary skills in export credit finance and investment banking.
The company has granted 11,124,528 warrants to RMB Resources as part of the US$ 12 million subordinated loan facility agreement. One warrant entitles RMB Resources to one share. The warrants are exercisable.