Petra Diamonds to Build Modern Processing Plant for Cullinan Mine

Petra Diamonds Ltd. (LSE:PDL) announced that it’s launched a US$300-million notes issue and increased its senior lender debt facilities. It plans to build a modern processing plant at its South Africa-based Cullinan mine.

Highlights regarding the notes issue and debt facilities include:

• Petra is announcing today its intention to offer US$300 million in aggregate principal amount of senior secured second lien notes due 2020 (the ‘Notes’).
• Petra’s lender group has agreed in principle, subject to the closing of the Notes, to increase the Group’s debt facilities by ca. US$81.6 million to ca. US$302.4 million, along withcertain amended availability and repayment terms.
• Proceeds from the Notes will be used to settle (but not cancel) certain existing debt and, together with future drawdowns from the Group’s debt facilities, to fund the construction of a modern processing plant at Cullinan, for general corporate purposes and to pay fees and expenses associated with the Notes.
• The Notes, along with the increase in lender group debt facilities, will diversify Petra’s sources of funding, providing the Group with additional financial flexibility as it pursues its stated growth strategy.

In terms of the Cullinan plant, the company said:

The Company is planning the construction of a modern, fit-for-purpose processing plant at Cullinan for a capital cost of ca. R1,650 million (US$142.8 million). This new plant is expected to:

• improve the recovery of the full spectrum of diamonds (thereby increasing the volume of stones recovered, as well as better protecting large stones from breakage); and
• improve the efficiency of the material flow, thereby significantly lowering operating costs.

Click here to read the full Petra Diamonds Ltd. (LSE:PDL) press release.