On July 7, 2017, B2Gold entered into an amended and restated credit agreement with a syndicate of international banks for an up-sized revolving credit facility (RCF) for an aggregate amount of $500 million, representing a $75 million increase from the principal amount of $425 million under its existing revolving credit facility.
The up-sized RCF also allows for an accordion feature whereby upon receipt of additional binding commitments, the facility may be increased to $600 million any time prior to the maturity date.
HSBC, as sole lead arranger and sole book runner, will continue to act as the administrative agent. The syndicate includes The Bank of Nova Scotia, Société Générale, ING Bank N.V. and Canadian Imperial Bank of Commerce as lenders.
The up-sized RCF will bear interest on a sliding scale of between LIBOR plus 2.25% to 3.25% based on B2Gold’s consolidated net leverage ratio.
Commitment fees for the undrawn portion of the facility will also be on a similar sliding scale basis of between 0.50% and 0.925%. The term of the up-sized RCF is four years, maturing on July 7, 2021.
If the principal indebtedness outstanding under B2Gold’s existing 3.25% convertible senior subordinated notes maturing on October 1, 2018, is greater than $100 million on December 29, 2017, then the sliding scale interest will increase to a sliding scale range of between LIBOR plus 2.50% to 4.00%.
The up-sized RCF will also be subject to customary lending covenants for a corporate facility.
Proceeds from the loan will be used for general corporate purposes and may be utilised to prepay or repay the subordinated notes and financing acquisitions.
B2Gold also believes that coupled with operating cash flows from it’s existing mine operations, the up-sized RCF ensures that B2Gold remains fully funded to maintain its operations, including funding for the construction of the Fekola project (completion anticipated October 2017).
Along with the additional $75 million capacity under the up-sized RCF, the $100 million accordion feature is expected to provide B2Gold with additional flexibility to access additional funding in the future for other corporate activities without the carrying cost of paying undrawn commitment fees.