31st May 2016 10:28
LONDON (Alliance News) - First Quantum Minerals Ltd on Tuesday announced a refinancing of its existing borrowing facility, completing a new term loan and revolving credit facility.
The new USD1.82 billion facility comprises a USD907.5 million term loan facility, and a USD907.5 million revolving credit facility, maturing in December 2019, and replaces an existing USD3 billion facility.
The latest financing package includes revised financial covenants and an extended amortization schedule that starts in June 2017, which is meant to help to improve the financial flexibility of the company without reducing liquidity, while further reducing net debt.
The facility will leave the company with about the same liquidity within the next 12 months, when compared to the existing USD3 billion facility, First Quantum said.
Under the new facility, the 5.5 times ratio of current net debt to earnings before interest, tax, depreciation and amortisation will be maintained until the third quarter of 2017. The ratio will then reduce to 5.0 times until the first quarter of 2018, then to 4.5 times until the third quarter of 2018, and to 3.5 times until 2019, when it will reduce to 3.25 times.
The new facility also incorporates an accordion feature to enable it to be increased to up to USD2.2 billion at the company's discretion.
"This refinancing, along with the asset sales and project financing initiative, ensures continued financial flexibility for the company moving forward, reduces net debt but not liquidity, allowing us to focus on our operational and developmental goals, while protecting against short term volatility in the commodities markets," Philip Pascall, chairman and chief executive officer of First Quantum, said in a statement.
"We thank our banks for their continued strong support for our strategy," Pascall said.
The initial mandated lead arrangers are BNP Paribas, Barclays Africa Group, Societe Generale London Branch and Standard Chartered Bank.
By Samuel Agini; [email protected]; @samuelagini
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