Troy secures A$40m in finance
PERTH (miningweekly.com) – Dual-listed gold miner Troy Resources has secured A$40-million in funding to fund the takeover of fellow-listed Azimuth Resources, and to fund ongoing work on that company’s West Omai deposit.
Earlier this year, the ASX- and TSX-listed Troy launched a takeover offer for Azimuth, offering one of its own shares for every 5.695 Azimuth shares held.
The gold miner said on Monday that it had now signed a mandate letter and term sheet with Investec Bank, which would see the bank provide A$40-million in loan facilities.
The facilities would consist of a A$20-million revolving corporate facility and a A$20-million revolving acquisition loan facility. Neither facility would require gold or silver price hedging, although a discretionary risk management facility was available.
As part of the consideration for the provision of the facilities, and subject to TSX approval, Troy would grant more than 1.3-million call options to Investec, to the value of A$5-million, with an exercise price of A$3.67 a share, and a three-year term.
Troy MD Paul Benson said on Monday that the new facilities would not only give Troy flexibility over the next few years, but would provide a degree of comfort and certainty, which was invaluable in the current volatile markets.
“In particular, the acquisition loan facility is expected to allow us to accelerate activities at West Omai. It also puts us in a strong position to acquire a second-hand plant suitable for the mine’s development, which is part of Troy’s successful strategy of minimising mine development capital,” said Benson.
Investec has previously provided Troy with A$35-million in loan funding to assist with the construction of the Casposo gold project, in Argentina. The loan was repaid ahead of schedule, on October 2012.
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