Orvana Minerals (ORV-T) July 27, '16 is pleased to announce that it has entered into a $12.5 million copper concentrates and gold doré prepayment agreement (the "Facility") with Samsung C&T U.K. Ltd. ("Samsung C&T"). All dollar figures are in US unless otherwise expressed.
Jeff Hillis, Interim Chief Executive Officer, said, "We are very pleased to announce this commercial and financing partnership with Samsung, a reputable and well-recognized global corporation. We are very proud that, after detailed due diligence by Samsung, Orvana's gold and copper production will form part of its future plans. The successful completion of this transaction, at a competitive cost of capital, represents a significant achievement for Orvana. The financing proceeds will allow us to expedite planned development and infrastructure investments at our El Valle Mine in Spain, as we continue on the path to increase metal production and lower unitary costs at the operation. Along with our recent announcement on May 30, 2016 of the US$7.9 million financing for the recommissioning of the CIL circuit at our Don Mario Mine in Bolivia, we believe that Orvana is now well-positioned for the future and will be able to capitalize on strengthening precious metals markets."
Under the terms of the Facility, Orvana will sell gold doré from its El Valle Mine in Spain and copper concentrate from its Don Mario Mine in Bolivia to Samsung C&T, on an exclusive basis for a period of thirty months (the "Facility Term"). In exchange, Orvana will receive $12.5 million in prepayment financing from Samsung C&T in two instalments. The first instalment of $8.0 million will be drawn upon closing and will be repaid beginning twelve months after drawdown in eighteen equal monthly payments. The second instalment of $4.5 million will be available for drawdown six to twelve months after closing and will be repaid beginning nine months after drawdown in nine equal monthly payments. The Facility will bear interest at LIBOR plus 4.5%. Interest payments and principal repayments will be made against Orvana's future shipments of copper concentrates and gold doré during the Facility Term. Samsung C&T has agreed to pay for copper concentrates and gold doré on at a price based on the prevailing metal prices for the gold, silver and copper content around time of shipment, less customary treatment, refining and shipping charges, and pursuant to the terms of the Facility.
The Company's obligations to Samsung C&T under the Facility are secured by the pledge to Samsung C&T of all of Orvana's shares of its indirectly wholly owned subsidiary OroValle Minerals S.L.U. which owns El Valle Mine in Spain.
Drawdown of the Facility is subject to satisfaction of customary closing conditions by Orvana for this type of transaction.
About Orvana
Orvana is a multi-mine gold and copper producer. Orvana's operating assets consist of the producing gold-copper-silver El Valle mine in northern Spain and the producing gold-copper-silver Don Mario mine in Bolivia. Additional information is available at Orvana's website ( www.orvana.com). |
