[miningmx.com] — GREAT BASIN GOLD (GBG) said on Friday that it was
granted a $35m working capital loan by its existing lenders.
These lenders would be granted “super-priority’ on GBG’s assets as security. The loan
has a term of six months, extendable for up to three months.
GBG earlier this month filed for business rescue under the South African Companies
Act, as well as for protection under Canada’s Companies Creditors Arrangement Act
(CCAA).
The CCAA allows the company a period of time to seek buyers and partners for its two
gold mining projects, or corporate level financiers.
“The loan proceeds will be used … to affect an orderly suspension of operations at
Burnstone, ongoing care and maintenance of Burnstone assets, and for
working capital at Hollister,’ the company said.
“Hollister is expected to continue profitably producing gold at the rate of 6,000 to
7,000 ounces per month for the foreseeable future and no insolvency filings are
currently expected for the Nevada operations.’
Said Lou van Vuuren, interim CEO: “We are confident that given the industry
interest we are seeing in these two assets we will see one or more realisation or
recapitalisation transactions complete within the term of the loan.’
