Anglo Asian to refinance debt, releases $8.4m for expansion plans

12th February 2018 By: Mariaan Webb - Creamer Media Senior Researcher and Deputy Editor Online

JOHANNESBURG (miningweekly.com) – Aim-listed gold, copper and silver producer Anglo Asian on Monday announced a refinancing package to replace the majority of its existing loans, which not only lowers the cost of its debt, but also allows for the redeployment of capital for exploration and optimisation plans.

The Azerbaijan-focused company said it had entered into a syndicated, two-year term loan facility with Pasha Bank as arranger for up to $15-million at a 7% a year fixed interest rate.

A total of $13.47-million of the facility would be used to repay existing loans to Amsterdam Trade Bank, Gazprombank (Switzerland), Reza Vaziri (Anglo Asian CEO) and Yapi Credit Bank.

A $2.1-million loan with the International Bank of Azerbaijan would not be refinanced, but the interest rate has been reduced from 12% to 7%.

Following the refinancing, debt principal repayments would be reduced to $5.1-million, releasing $8.4-million to support expansion and optimisation initiatives at the Gedabek project.

The refinancing facility would save estimated interest payments of $0.1-million this year.

“The facility is unsecured and there are no financial covenants, which demonstrates the confidence that Pasha Bank and others have in our business. This is, to our knowledge, the first time a syndicated loan has been arranged in Azerbaijan, which again confirms the company as a first mover in the country,” Vaziri said in a statement.

Anglo Asian reported last week that it expected 2018 to be the “year of delivery”, forecasting significantly higher production from the Gedabek mine. The guidance for the mine is 78 000 to 84 000 gold equivalent ounces, the mid-point of which is more than 13% higher than 2017’s production of 71 461 gold equivalent ounces.