DiamondCorp puts ‘last piece in funding jigsaw’
South African diamond mine development and exploration company, the JSE- and Aim-listed DiamondCorp, has finalised the funding needed for expansion of its Lace diamond operation in South Africa.
The company said in a Stock Exchange News Service announcement that it had conditionally raised £4.2-million through the issue of 14% senior secured convertible bonds to total R40-million of bonds issued to investors in South Africa and £1.4-million to investors in the UK.
The bond issue was described as the “last piece of the funding jigsaw”.
It equated, the company said, together with the $6-million term loan from Tiffany subsidiary Laurelton Diamonds, to the R113-million needed to finalise the funding for the 1.2-million-ton-a-year underground block cave development on 47 level at the Lace diamond mine.
The proceeds from the bonds and the Tiffany loan would allow DiamondCorp to meet its initial drawdown condition on the R220-million project finance facility secured from South Africa’s State-owned Industrial Development Corporation, providing overall project funding of R320-million for the Lace mine development, including a 33% capital contingency.
Investors in the UK bonds included DiamondCorp CEO Paul Loudon and company chairperson Euan Worthington, who have each invested £100 000, and Loeb Aron & Co, which has invested £60 000. DiamondCorp board members Loudon and Jonathan Willis-Richards are directors of Loeb Aron & Co.
Bond interest must be paid quarterly in arrears and capital on December 31, 2018.
“We are very pleased to have arranged the funding required for the Lace underground development in a period of extremely challenging capital markets,” said Loudon.
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