Resolute has received A$100 million of upfront proceeds consisting of A$50 million in cash and A$50 million in promissory notes which earn a 6% coupon
Resolute Mining Limited (Resolute or the Company) (ASX/LSE: RSG) is pleased to announce the successful completion of the sale of the Ravenswood Gold Mine in Queensland (Ravenswood) to a consortium comprising a fund (EMR Fund) managed by specialist resources private equity manager EMR Capital Management Limited (EMR Capital), and Singapore-listed mining and energy company, Golden Energy and Resources Limited (SGX:AUE) (GEAR). The sale of Ravenswood has been completed in accordance with the transaction terms and timeline outlined in the definitive agreements signed in January 2020 (see ASX Announcement dated 15 January 2020).
Resolute has received A$100 million of upfront proceeds consisting of A$50 million in cash and A$50m in promissory notes which earn a 6% coupon. Resolute retains additional upside exposure to Ravenswood through two further notes valued at up to A$200 million which may result in payments to Resolute of:
- up to A$50 million linked to the average gold price over a four-year period; and
- up to A$150 million linked to the investment outcomes of Ravenswood for the EMR Fund.
The sale of Ravenswood provides immediate liquidity and exposure to the future success of the Ravenswood Expansion Project while transferring the capital expenditure funding requirements and development obligation to a highly credentialed and experienced consortium with a strong relevant track record in successful project development.
Resolute’s Managing Director and CEO, Mr John Welborn, was pleased to have completed the transaction:
“The sale of our Ravenswood Gold Mine delivers on our objective of ensuring a new long-life future for Ravenswood while maximising value for Resolute shareholders. Settlement enables us to focus our attention and energy on our African portfolio and the abundant opportunities for further growth and value creation.”
“Ravenswood has been a strong performer for Resolute for more than 15 years. During this time Resolute has mined and processed over 40 million tonnes of ore and produced almost two million ounces of gold. I congratulate the Resolute team, both past and present, for our performance at Ravenswood. We are proud of our achievements in Queensland and the significant economic benefits we have provided to the local community, the government, and Resolute shareholders. We are confident Resolute’s legacy, and the interests of all stakeholders in Ravenswood, will be protected and enhanced by the new owners.”
Updated Guidance for the 12 months to 31 December 2020
Following the sale of Ravenswood, Resolute’s updated guidance for 2020 has been set at 430,000oz at an AISC of US$980/oz. This guidance is consistent with previously released guidance for the Syama Gold Mine in Mali of 260,000oz at an AISC of US$960/oz and for the Mako Gold Mine in Senegal of 160,000oz at an AISC of US$800/oz (see ASX Announcement dated 13 January 2020). Resolute’s 2020 guidance is inclusive of corporate overheads, reflects gold production from Ravenswood of 10,000oz, and is consistent with the Company’s recent COVID-19 business update (see ASX Announcement dated 26 March 2020).
Source: Company Press Release