Amsterdam, 3 April 2012 - Nord Gold N.V. (“Nordgold” or the “Company”) (LSE: NORD), an established pure-play emerging-markets gold producer, is pleased to announce that it has signed a loan agreement worth 11 billion roubles (c.US$ 374 million) with Sberbank, the largest financial institution in Russia.
Nordgold has successfully secured a three year rouble loan with a grace period of 21 months and quarterly repayments thereafter. Nordgold intends to enter into a cross-currency swap to exchange the loan’s currency into US Dollars to ensure it matches with the Company’s functional currency. This step will also allow the company to reduce pricing of the raised financing.
The proceeds of the facility have been used to repay Nordgold’s outstanding debt to OAO Severstal and its affiliates ("Severstal") of approximately US$ 360 million. This repayment completes all debt arrangements between Nordgold and Severstal and reflects the formal separation of the two companies announced on 14 March 2012. Nordgold retains a strong balance sheet with net debt of less than US$ 200 million and will continue to finance its capital expenditure and dividend programmes through the company’s generated cash flow.
This is a very positive development for the Company as this agreement marks Nordgold’s first loan facility as an independent company. The agreement with Sberbank was made within a short time period, secured at a relatively low interest rate and includes a comfortable grace period. Nordgold aims to continue as a first-rate borrower with a comfortable debt level and an optimal capital structure. This is a good start for our credit history as a company and shows confidence in our business from Sberbank and from the market. Nikolai ZelenskiCEO of Nordgold
We are very proud to arrange the credit facility for Nordgold, one of the largest gold mining companies in Russia and in the world. This facility is aimed to support the Company on its first steps as an independent entity and we highly appreciate that the Company starts its credit history with Sberbank. We are looking forward to strengthen and expand further our strategic partnership comprising the full range of investment and commercial banking services. Alexey GrenkovHead of key client coverage, Key Corporate Clients Department of Sberbank
Head of Financial Communications and IR
Phone: +31 20 406 4480
Phone: +31 20 406 4480
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Tel.: +44 20 7379 5151
Nordgold (LSE: NORD) is an established pure-play emerging-markets gold producer, with operations in Burkina Faso, Guinea, Russia and Kazakhstan.Nordgold is a young and dynamic company. Since its establishment in 2007, it has expanded rapidly through acquisitions and organic investment, achieving a rate of growth unmatched in the industry during that period. By 2011 the company’s gold production was 754 Koz.Nordgold has eight active mines, two development projects, five advanced exploration projects and a broad portfolio of early exploration projects and licenses.Nordgold’s target is to produce 1 Moz of gold from existing mines and development projects by 2013. This target is underpinned by company’s gold reserves of 8.2 Moz and resource base of 22,7 Moz of gold and 103 Moz of silver.