LONDON (ShareCast) - Shanta Gold, an East African focused gold mining company, has signed and drawndown of a 30m dollar medium-term facility with FBN Bank.
The proceeds of the facility will be used in part to cover the remaining monthly principal repayments of the outstanding loans with FBN ($10.0m) and YA Global Master ($5.3m). It will also provide the company with cashflow generated by its gold sales provides Shanta Gold with appropriate cash headroom during the New Luika ramp up phase.
Mike Houston, Chief Executive Officer of Shanta Gold, said: "We are pleased to have finalised and drawn down sufficient funds to provide the necessary headroom during the early stages in the production growth curve and to enter into this new phase in banking relationship with FBN who continue to show a strong commitment to the New Luika project."
The facility is secured over the shares and business assets of Shanta's Tanzanian subsidiary company Shanta Mining Company and has an interest rate of LIBOR plus 8.0% per annum, with a 2.0% arrangement fee.
The facility is repayable over two years with a capital holiday for the first six months and repayment occurring over 18 equal monthly instalments thereafter.
The share price rose 6.29% to 19p by 15:14.