19th Jun 2019 13:46
(Alliance News) - Russian gold miner Petropavlovsk PLC is to offer USD100 million of new bonds at the same time as offering to buy back existing bonds.
The convertible bonds being offered will be due in 2024. Each bond will have a principal amount of USD200,000 and carry a coupon of between 8.00% and 8.50% per year. Petropavlovsk has the option to add USD25 million to the offer.
The bonds can be converted into Petropavlovsk shares at a premium between 20% and 25% above the company's volume-weighted London share price between launch and the close of trade Wednesday.
Petropavlovsk shares were down 5.9% on Wednesday afternoon at a price of 8.75 pence each.
Petropavlovsk will issue the proceeds from the bond issue to build a new flotation facility at the Pioneer mine, one of Russia's largest gold mines, located in Amur Oblast. This is expected to cost USD25 million to USD30 million, and the company hopes to begin commissioning in the last quarter of 2020.
The facility at Pioneer will produce refractory gold concentrate for processing into gold dore at the newly-built pressure oxidation hub at the old Pokrovskiy mine.
In a concurrent buyback, Petropavlovsk will offer USD1,080 per USD1,000 of existing USD100 million 9.00% convertible bonds due in 2020.
Related Shares:
POG.L