HARMONY Gold said on Tuesday it had concluded new loan deals, including a facility in Australian dollars, in order to cater to its expansion into the country.
It signed a A$500m facility with a syndicate of banks, along with two other transactions comprising a US$500m facility and a R7bn loan.
The facilities reduced Harmony’s funding costs, strengthened liquidity and optimised its capital structure, said Beyers Nel, CEO of Harmony, in a statement.
“Importantly, the transaction extends our maturity profile and provides funding capacity in the currencies most relevant to our growth pipeline,” he added.
Harmony has bought two assets in Australia: the CSA mine, through the $1.25bn acquisition of MAC Copper, and Eva Copper, a $1.75bn copper project. Put together, the two have the potential to see Harmony produce 100,000 tons a year of copper, which would help de-risk the business, as it is currently focused on underground gold mining in South Africa.
“As the group builds a meaningful Australian copper business alongside its South African gold operations, this funding structure improves financial flexibility, enhances the alignment between funding sources and underlying assets, and supports the disciplined execution of Harmony’s long-term growth strategy,” the company said.
There was 93% lender participation in the loans, said Harmony. In addition, commitments totalled around three times the targeted amount. “The significant oversubscription reflects the strength of lender confidence in Harmony and resulted in a substantial scale-back of commitments,” said Harmony.
Citi and Nedbank were joint global coordinators and mandated lead arrangers on the refinancing.
