Evolution Mining (ASX:EVN) prices maiden debt placement; key details

Highlights

  • Evolution Mining has priced a maiden debt private placement of US$550 million.
  • The mining firm said that it has received an investment grade rating from a major reputable rating agency as part of the private placement.
  • The placement consists of US$200 million maturing November 2028 with a fixed rate coupon of 2.83% and US$350 million maturing November 2031 with a fixed rate coupon of 3.17%.

Evolution Mining Ltd (ASX:EVN) on Friday announced that it had priced a maiden debt private placement of US$550 million. The mining firm said that it has received an investment grade rating from a major reputable rating agency as a part of the private placement.

Evolution Mining also said that its placement offer had received strong investor support with a significant level of oversubscription.

Evolution Mining’s placement offer

The US$550 million debt private placement comprises – US$200 million maturing November 2028 with a fixed rate coupon of 2.83% and US$350 million maturing November 2031 with a fixed rate coupon of 3.17%. The company has entered cross currency swaps to hedge the US dollar exposure.

Source: ©Miflippo  | Megapixl.com

How will the proceeds be used?

The company said that the proceeds from the placement will be used to repay the existing term loan facility associated with the acquisition of Red Lake and for general corporate purposes. Following this placement, the company’s debt maturity profile will be extended from an average of 2.7 years to 7.1 years.

READ MORE:NAB announces a buyback of AU$2.5 billion

What’s Evolution Mining’s management saying?

Commenting on the development, Evolution’s Finance Director and Chief Financial Officer, Lawrie Conway said: “The placement announced today is consistent with our approach of maintaining a strong balance sheet to fund our strategy and enable the business to prosper through the cycle.”

Conway further said that transaction would also ensure that the company’s debt profile better matches its asset portfolio of long-life and high-quality operations.

“The completion of the placement will further optimise our balance sheet, repay the existing Red Lake term loan facility and provide us with additional capacity to fund existing and future growth initiatives and maintain flexibility around our dividends,” he said.

Source: © Herrbullermann  | Megapixl.com

Conclusion

Evolution Mining share price is expected to trade higher on Friday after its successful maiden debt private placement announcement. On Thursday, Evolution Mining shares closed 1.01% lower at AU$3.92. The shares have given a negative year-to-date (YTD) return of nearly 26% and a negative past year return of 31%.

READ MORE: CBA (ASX:CBA) announces record buyback, doubles dividend after 20% profit jump

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