Refinancing of Syndicated Loan Complete
Highland Gold Mining Limited ("Highland Gold", or the "Company") is pleased to announce the completion of a debt restructuring programme. The Company has raised US$90 million in new financing with two new debt facilities with two Russian banks comprised of a US$60 million facility with MDM Bank and a US$30 million facility with GazpromBank. This debt restructuring is a key element of Highland Gold’s capital management plan and aligns the company’s debt maturities with its business plans.
The new facilities reduce Highland Gold’s cost of debt and provide greater flexibility which is better suited to a growth focused company like Highland Gold. Additionally, this will allow the Company to reclassify these debt facilities as long term borrowings in future regulatory accounting filings. Proceeds from the new financing facilities have been used to complete the early repayment of the existing Syndicated Loan Facility (approximately $25.6 million) with the remainder of the funds being used to fund a large portion of the final project development costs at the Novoshirokinskoye polymetallic deposit and ongoing development costs at the Mayskoye and Taseevskoye gold deposits. Novoshirokinskoye, a joint venture project between Highland Gold and Kazzinc, is presently the most advanced project in the Company’s growth pipeline with final construction works now underway and commissioning anticipated in 2008.
Commenting on today's announcement, James Cross, Chairman said, "When we announced the increase in Barrick's shareholding in November we indicated we would be reviewing options to raise funds to continue the development of the business. These new banking facilities largely satisfy this funding requirement, underpinning the Company's development of Novoshirokinskoye and the ongoing development of Mayskoye and Taseevskoye. Furthermore, a number of leading Russian and International Banks have already expressed their interest in providing and/or participating in future project financing facilities for Mayskoye and Taseevskoye and these will be investigated further in the lead up to the finalisation of each project’s feasibility study."
For further information please contact:
|Enquiries:||London: +44 (0) 207 851 64 00
Moscow: + 7 (495) 777 31 55
Henry Horne, Managing Director
Dmitry Yakushkin, Communications Director
Dominic Palmer-Tomkinson, Head of
Or, WMC Communications, Alex Glover on
+44 20 7930 9030