South Africa – Sibanye Gold, JSE- and NYSE-listed South African gold producer, announced on Wednesday that it has been released as guarantor from Gold Fields R12 billion bond, issued on 30 September 2010 by Gold Fields subsidiary , Gold Fields Orogen Holding.
Sibanye remained as a guarantor of the bond after its unbundling by Gold Fields in February 2013. This restricted Sibanye’s debt capacity, as lenders considered the contingent liability which arose from the guarantee as debt.
During March 2015 Gold Fields approached the bond noteholders through a consent solicitation process to release Sibanye of its obligations as a guarantor under the bond.
On April 22, 2015 the noteholders approved the various resolutions to release Sibanye as a guarantor. The release became effective on April, 242015 when all the conditions to the extraordinary resolution were met.
Sibanye Gold CFO Charl Keyter says the R12 billion guarantee has always been a concern to Sibanye’s lenders, resulting in complex funding arrangements and the imposition of certain limitations on its borrowing capacity.
“The removal of the guarantee enhances balance sheet flexibility and increases Sibanye’s capacity for debt, should it require it. This is positive for our credit and equity profile and completes the successful unbundling of Sibanye by Gold Fields” says Keyter.