Kinross Gold Corp. has increased its revolver from $125 million to $295 million in a deal co-led by Scotia Capital and Société Générale. The facility will help pay for the $260 million the company forked over for the final 51% of the Rio Paracatu Mineracao, the owner of the Morro do Ouro mine in Brazil. The company had gained its 49% interest on Jan. 31, 2003, when it merged with TVX Gold.
It has a three-year maturity with pricing based on the company's leverage ratio. Although he would not state the price at which it launched, Lars-Eric Johansson, executive v.p. and cfo, said the pricing was "great."
The remaining funds will be used to provide liquidity and for other general purposes. "We keep focusing on improving our existing operations, and if possible, to fully utilize the potential we believe we have in those mines," he said. No other acquisition or investment opportunities are currently pending.
RBC Capital Markets and ANZ Banking Group also carried over from the previous loan and served as documentation agents on this increase. New banks to the deal include CIBC World Markets and Royal Bank of Scotland. The selection of Scotia and Société Générale as leads was based on the banks' long standing relationships with the company.
Kinross is currently in default of filing financial statements for 2004 as it awaits a final resolution to issues dealing with accounting of good will with regards to Kinross' acquisition of TVX and Echo Bay in 2003. Headquartered in Toronto, Kinross is a gold producer with 13 gold producing properties in six countries.