TIDMGGP
RNS Number : 0719Z
Greatland Gold PLC
12 September 2022
12 September 2022
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED
UNDER THE UK MARKET ABUSE REGULATIONS. ON PUBLICATION OF THIS
ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION
IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.
Greatland Gold plc
("Greatland" or "the Company")
Greatland secures pathway for fully funding its share of the
development of Havieron
Bank debt facilities of A$220m committed with a syndicate of
leading international banks
Proposed strategic equity investment of up to A$120m in
Greatland by Wyloo Metals
Upon completion, Greatland's 30 per cent share of the Havieron
development expected to be fully funded through to production
Greatland Gold plc (AIM:GGP), is pleased to announce the
execution of debt and equity agreements to secure up to total of
A$340 million in new funding that is expected to enable Greatland
to fully fund its 30 per cent share of Havieron into
production.
Highlights:
-- Commitment Letter, including Terms Sheet, signed for a A$220m
(c.GBP130m), seven-year term, self-arranged debt syndicate with
three leading banks: Australia and New Zealand Banking Group
Limited ("ANZ"), HSBC Bank ("HSBC") and ING Bank (Australia)
("ING")
-- Strategic equity investment from Wyloo Metals ("Wyloo"), a
privately owned metals company with a focus on investing in the
responsible develop ment of the next generation of mines
-- Wyloo initial strategic equity subscription of A$60m
(c.GBP35m), which is subject to shareholder approval, and with an
additional future potential equity contribution of A$60m, providing
a total of A$120m
-- Initial equity subscription priced at 8.2 pence per share
("Wyloo Placement"), being the same price at which equity was
raised in the recent placing (announced 24 August 2022) and small
premium to the five-day volume weighted average share price
("VWAP") to 9 September 2022, and resulting in Wyloo becoming
Greatland's largest shareholder with approximately 8.6 per cent of
shares on issue
-- Wyloo's further potential investment is through the issue of
warrants to subscribe for additional equity as ordinary shares at
an exercise price of 10.0 pence per share ("Wyloo Warrants") which,
if exercised in full, will realise further gross proceeds of
approximately GBP35m. If the Wyloo Warrants are exercised in full,
the average price of Wyloo's investment in Greatland would be just
over 9.0 pence per share being a 10.6 per cent premium to the
five-day VWAP to 9 September 2022
-- The Wyloo Placement and the Wyloo Warrants are subject to
shareholder approval. An extraordinary general meeting is expected
to be convened in October 2022 . The Directors unanimously
recommend that shareholders vote in favour of the approval
resolution.
-- Completion of the debt facilities and Wyloo Placement will
enable Greatland to be fully funded for its 30 per cent share of
the Havieron project development based upon the October 2021 2Mtpa
Pre-Feasibility Study; and well positioned to be fully funded in
respect of the Feasibility Study targeting an expansion to around
3Mtpa due in the December 2022 quarter
-- Securing the debt facility commitment letter with Tier 1
banking institutions prior to the finalisation of the Feasibility
Study reflects the highly bankable nature of the project and the
quality of the Havieron asset
-- Highly competitive term debt interest rate at 3.50% p.a.
margin plus BBSY benchmark reducing to a margin of 3.25% p.a. post
project completion with early repayment flexibility
Shaun Day, Managing Director of Greatland Gold plc, commented:
"This is a tremendous announcement for Greatland to have a pathway
to being fully funded for its share of the development costs of
Havieron. This outcome has been achieved through a combination of
equity market support, including today's execution of strategic
investment agreements with Wyloo and with the support from a
syndicate of high-quality banks providing a commitment letter in
respect of A$220m of debt funding.
"The significant size of each bank's commitment together with
the strategic support from Wyloo highlights the long-term
confidence in the Havieron gold- copper project and the strength of
this world class asset.
"The selection of ANZ, HSBC and ING as our banking partners
reflects their quality as financial institutions, commitment to
supporting high-quality asset development and their strong
relationship commitment throughout the banking process.
"Following shareholder approval, we look forward to welcoming
Wyloo as our strategic partner and largest shareholder to complete
the Havieron funding package.
"Completing the debt facilities and Wyloo investment will enable
Greatland to be fully funded for its share of costs in developing
the Havieron project into first production and potential free cash
flow which will provide long-term financial stability and create
significant value for Greatland and its shareholders."
Luca Giacovazzi, CEO of Wyloo Metals, commented : "Havieron is
one of the most exciting discoveries in Western Australia's
emerging Paterson Range that continues to grow in scale and quality
as the understanding of this tier-one system evolves.
We are proud to be supporting Greatland to develop WA's next
copper-gold mine into a low cost, modern mining operation with very
high environmental and social standards.
"We are equally as excited to be supporting the Company's
ongoing exploration of its expansive tenement package, which we
think has great potential for further discovery."
Strategic equity investment by Wyloo Metals
Wyloo has agreed to subscribe for, and the Company has agreed to
allot and issue, an initial total of 430,024,390 new fully paid
ordinary shares ("Ordinary Shares") at an issue price of 8.2 pence
per Ordinary Share to raise gross proceeds of A$60m (c.GBP35m)
under the terms of a subscription agreement (the "Wyloo
Placement"). The issue price represents a small premium to the
five-day VWAP to 9 September 2022. The subscription proceeds will
be settled in Australian dollars at an exchange rate 0.5877
(AUD:GBP).
The Company will also issue to Wyloo (through its wholly owned
subsidiary Wyloo Consolidated Investments Pty Ltd) warrants to
subscribe for up to an additional 352,620,000 Ordinary Shares
which, if exercised in full, will realise gross proceeds of GBP35m
(c.A$60m). The Warrants have an exercise price of 10.0 pence per
Ordinary Share and may be exercised at any time up to the third
anniversary of grant. If the Warrants are exercised in full, the
average price of Wyloo's investment on Greatland would be just over
9.0 pence per Ordinary Share being a 10.6 per cent premium to the
five-day VWAP to 9 September 2022.
The allotment and issue of the shares in the Wyloo Placement and
the Wyloo Warrants are subject to the approval of Greatland
shareholders. Accordingly, the Company intends to send a Notice of
Meeting in September 2022 to hold an Extraordinary General Meeting
in October 2022. A further announcement will be made when the
notice of meeting is sent to shareholders.
When completed, the Wyloo Placement will result in Wyloo
(through its wholly owned subsidiary Wyloo Consolidated Investments
Pty Ltd) becoming Greatland's largest shareholder with
approximately 8.6 per cent of shares on issue. Upon exercise of the
Wyloo Warrants in full, Wyloo's shareholding in Greatland would
increase to approximately 14.6 per cent.
Settlement in accordance with the subscription agreement is
scheduled to occur upon the admission of the Ordinary Shares
comprised in the Wyloo Placement to trading on the AIM market of
the London Stock Exchange ("Admission") following shareholder
approval and within five business days of shareholder approval.
Subject to shareholder approval, application will be made for
Admission and a further announcement will be made on the proposed
timing of Admission which is expected to occur on or before 31
October 2022.
Bank debt facility
The self-arranged syndicated bank debt facility was completed
following very strong market interest from a number of leading
international financial institutions.
With the selection of the final bank group comprising ANZ, HSBC
and ING reflecting the calibre of these financial institutions and
their strong relationship commitment throughout the banking
process.
This financing facility is a key component of Greatland's f
unding strategy to maximise available debt funding with banks
before the Feasibility Study and repay the Newcrest facility to
maximise shareholder value. Key terms of the proposed facility
are:
-- The A$220m secured debt facilities comprise:
-- Facility A: A$200m seven-year amortising Term Debt
Facility
-- Facility B: A$20m five-year Revolving Credit Facility
-- Interest will be charged at benchmark (Australian BBSY) plus
Margin of:
-- Facility A: 3.50% p.a. reducing to 3.25% p.a. post project
completion
-- Facility B: 4.50% p.a.
-- Amortisation of Facility A will only commence 12 months post
project completion, but no later than 21 December 2025, including a
bullet repayment of A$40m due at the maturity of Facility A
-- Proceeds from the first drawdown are expected to repay the
existing Newcrest Loan Agreement. This will provide a substantial
cost saving by reducing interest from benchmark plus 8.00% down to
benchmark plus 3.50%
-- Use of funds includes:
-- to refinance the US$50m Newcrest Loan Agreement in full
-- fund called sums with respect to the Havieron Project
-- other costs and expenses not included as called sums and
costs in connection with the Havieron project or Joint Venture
including taxes
-- Greatland corporate costs and other expenses
-- Repayment of Facility A may be accelerated by the operation
of a 50 per cent cash sweep in circumstances where the Company
generates excess free cash flow
-- The facility limit includes minimum pricing requirements for
the mandatory hedging, which is a total of 121koz of gold within
the first four years of production. No hedging of copper production
is presently intended
-- The facility provides for a standard project financing
security package which includes a parent guarantee from Greatland
Gold Plc until project completion
-- Costs, fees and expenses are payable by the Company in
connection with the debt facilities
The debt funding requires a total equity contribution of GBP60m
as a pre-condition to full draw down. The August 2022 equity
raising together with the Wyloo Placement announced today, fully
satisfies the equity requirement of the proposed financing.
Whilst the Company and the Banks have entered the Commitment
Letter, financial close of the proposed facility and draw down is
also subject to customary project financing conditions including
completion of reporting requirements, Feasibility Study criteria
and agreeing final documentation.
Enquiries:
Greatland Gold PLC info@greatlandgold.com
Shaun Day www.greatlandgold.com
SPARK Advisory Partners Limited (Nominated
Adviser)
Andrew Emmott/James Keeshan +44 (0)20 3368 3550
Berenberg (Joint Corporate Broker and Financial
Adviser)
Matthew Armitt/ Jennifer Lee/ Jack Botros +44 (0)20 3207 7800
Canaccord Genuity (Joint Corporate Broker
and Financial Adviser)
James Asensio/Patrick Dolaghan +44 (0)20 7523 8000
Hannam & Partners (Joint Corporate Broker
and Financial Adviser)
Andrew Chubb/Matt Hasson/Jay Ashfield +44 (0)20 7907 8500
SI Capital Limited (Joint Broker)
Nick Emerson/Sam Lomanto +44 (0)14 8341 3500
Gracechurch Group (Media and Investor Relations)
Harry Chathli/Alexis Gore/Tan Siddique +44 (0)20 3488 7510
Notes for Editors:
Greatland Gold plc (AIM:GGP) is a mining development and
exploration company with a focus on precious and base metals. The
Company's flagship asset is the potentially world class Havieron
gold-copper deposit in the Paterson region of Western Australia,
discovered by Greatland and presently under development through a
joint venture with Newcrest (the " JV "). Newcrest holds a joint
venture interest of 70% (30% Greatland).
Havieron is located approximately 45km east of Newcrest's Telfer
gold mine and, subject to positive feasibility study and decision
to mine, will leverage the existing infrastructure and processing
plant to significantly reduce the project's capital expenditure and
carbon impact for a low-risk and low-cost pathway to
development.
Construction is well advanced and continuing with the box cut
and decline to develop the Havieron deposit originally commenced in
February 2021. An extensive growth drilling programme continues at
Havieron with a view to further expanding the understanding and
scale of the ore body.
Greatland has a proven track record of discovery and exploration
success. It is pursuing the next generation of tier-one mineral
deposits by applying advanced exploration techniques in
under-explored regions. The Company is focused on safe, low-risk
jurisdictions and is strategically positioned in the highly
prospective Paterson region. Greatland has a total of six projects
across Australia with a focus on becoming a multi-commodity mining
company of significant scale.
Overview of Wyloo Metals
Wyloo Metals Pty Ltd is a privately-owned metals company with a
focus on investing in the critical mineral supply chain. Led by a
multidisciplinary team of geologists, engineers and financial
professionals, Wyloo Metals manages a diverse portfolio of
exploration and development projects and cornerstone interests in a
number of public companies. Wyloo has a long-term investment
mandate and is focused on producing commodities that support the
transition to a low-carbon future.
More information about Wyloo can be found on its website:
https://www.wyloometals.com
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END
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