Debt Refinancing - USD37M Loan Facility

RNS Number : 0477Q

Anglo Asian Mining PLC

09 October 2013

 



Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector: Mining

9 October 2013

Anglo Asian Mining plc ('Anglo Asian' or 'the Company')

Debt Refinancing - US$37 million Loan Facility Agreement

Anglo Asian Mining plc, the AIM listed gold producer in Azerbaijan, is pleased to announce that it has entered into a loan facility agreement ('Facility Agreement') with Amsterdam Trade Bank N.V. ('ATB').

Under the terms of the Facility Agreement, ATB has agreed to provide a committed term loan facility of up to US$37 million (the 'ATB Facility') to Azerbaijan International Mining Company LLP ('AIMC'), a wholly owned subsidiary of Anglo Asian.

The Board intends to draw down the full amount immediately as the ATB Facility attracts a lower interest rate, the proceeds shall be used to reduce the Company's existing loan facility with the International Bank of Azerbaijan ('IBA') which was used for the construction of an Agitation Leaching Plant at its flagship gold/copper/silver mine, Gedabek, and to pay certain fees and expenses in relation to the arrangement of the ATB Facility. 

Anglo Asian CEO Reza Vaziri said, "Our existing loan with the IBA enabled us to construct an Agitation Leaching Plant at our flagship Gedabek gold production project which was commissioned US$7 million under budget at US$45 million in June 2013.  Thanks to this injection of US$37million from the Amsterdam Trade Bank we can now pay down our existing loan at a reduced interest rate.  With lower operating costs and improved gold recoveries of both oxide and sulphide ores coming from Gedabek since the commission of the plant, as was expected, we look forward to the remainder of the year as we progress towards our FY2013 gold production target of 60,000oz."

Further Information

The ATB Facility has a term of 58 months and attracts a quarterly interest rate of LIBOR* plus 8.25 per cent. The first repayment instalment commences on the 25^th day of the 16^th month from the draw down date and the outstanding amount shall be repaid in equal quarterly instalments. Prepayments are permitted, subject to certain fees and conditions. The Facility Agreement also includes certain representations and warranties from AIMC. The ATB Facility is secured at the Company level.

The use of proceeds of Anglo Asian's existing loan facility from the IBA was to construct an Agitation Leaching plant at the Company's flagship Gedabek gold project in order to improve gold recovery and reduce operation costs.  The plant was commissioned in June 2013, US$7 million under budget at US$45 million.  With the plant now in operation and following record gold production of 7,600 ounces for the month of August 2013, the Gedabek gold production remains on target for FY 2013 remains at 60,000oz Au (c.20% increase from FY 2012 gold production of 50,125oz), with lower operating costs of US$450-500 per ounce.

The Company's existing loan facility with the IBA stands at US$48.2 million. There is no penalty for early repayment of the IBA loan facility. The outstanding balance of the IBA loan facility following the payment using the proceeds from the ATB Facility will be approximately US$11.6 million.   The outstanding balance of the IBA loan facility will continue to attract a quarterly interest rate of 12 per cent.

For further information please visit www.angloasianmining.com or contact:

Reza Vaziri	Anglo Asian Mining plc	Tel: [phone]
Sean Duffy	Anglo Asian Mining plc	Tel: [phone]
Ewan Leggat	SP Angel Corporate Finance LLP	Tel: [phone]
Laura Littley	SP Angel Corporate Finance LLP	Tel: [phone]
Felicity Edwards	St Brides Media & Finance Ltd	Tel: [phone]
Lottie Brocklehurst	St Brides Media & Finance Ltd	Tel: [phone]

* LIBOR means the applicable screen rate as of 12.00 am (Amsterdam time) on the rate fixing date for the offering of three months deposits in USD.

Notes:

Anglo Asian Mining plc (AIM:AAZ) is a gold producer in Central Asia with a broad portfolio of production and exploration assets in Azerbaijan.  The Company has a 1,962 sq km prospective exploration portfolio, assembled from analysis of historic Soviet geological data and held under a Production Sharing Agreement ('PSA') based on the Azeri oil industry.  The Company developed Azerbaijan's first operating gold/copper mine, Gedabek, which commenced gold production in May 2009.  Gold production for the year ended 31 December 2012 totalled 50,215 oz of gold and FY 2013 gold production target is 60,000 oz of gold in line with the successful commissioning of the new agitation leaching plant at Gedabek in H1 2013.

Anglo Asian is actively looking to exploit its first mover advantage in Azerbaijan to by developing additional projects, as well as looking for other properties in order to fulfil its expansion ambitions and become a mid-tier gold and base metal production company.  With this in mind, the Company is currently developing its second mining operation, Gosha, which is 50km away from Gedabek into a small, profitable mining operation and is targeting to increase the Company's total gold production by the end of 2014 to 80,000 to 90,000 ounces of gold.

 

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