Hummingbird sources capital for Yanfolila development

JOHANNESBURG (miningweekly.com) – Aim-listed Hummingbird Resources has entered into a mandate letter with Taurus Funds Management and secured an extension to the bridge loan facility to develop its Yanfolila gold project in Mali.

Through the facility, Hummingbird will receive a $55-million mandate, made up of a four-year $45-million senior secured term facility and a $10-million cost overrun facility.

Interest will be charged at a rate of 7.75% on the senior secured loan from project completion, which includes the passing of a number of economic and mechanical tests associated with being in commercial production, and the establishment of a debt service reserve account.

Hummingbird CEO Dan Betts on Tuesday noted that following successful equity raisings totalling $71-million earlier this year, construction at the project was now well under way, with over 20% of the capital expenditure committed.  

“We are very pleased with the progress made to date on site and securing this additional debt facility sees the final corporate hurdle overcome in order to expedite the construction process ahead of our initial gold pour, targeted for the end of 2017.

“With the significantly lower debt gearing on the project we are happy that it now satisfies Taurus’s requirements.  Taurus has completed all technical due diligence and the extension of the bridge facility by a further $10-million is representative of the commitment to Yanfolila,” he said.

Importantly, there are no significant conditions precedent required to refinance the bridge facility into the first draw of the term facility. “It is exciting to go into 2017 with a fantastic team in place and a fully funded, high-margin gold project already well into the construction phase,” said Betts.

The senior secured facility will be repaid through five semi-annual repayments starting September 30, 2018.  Repayments will be the higher of an agreed amortisation profile or 40% of free cash flow after paying interest.