After evaluating and considering a number of proposals,  the Company’s Board has finalised four debt financing facilities Gemfields plc  said yesterday.  

A facility of US$ 45 million  has been finalised  for  Gemfields’ 75% owned   Montepuez Ruby Mining Lda (MRM).

This consists of an agreement for  US$  15 million unsecured overdraft facility   entered into by MRM with Barclays Bank Mozambique S.A. (Barclays S.A.).   A  US$  15 million overdraft facility was entered into by MRM with Banco Comercial E De Investimentos, S.A. (BCI) in June 2016, which is  valid for 18 months and   renewable thereafter.  And a US$ 15 million finance leasing facility was entered into by MRM with BCI in June 2016. This is also a renewable facility with a drawdown period of 18 months and the amounts drawn down are repayable over a maximum period of 48 months. 

Apart from this, a US$ 20 million financing facility with Macquarie Bank Limited ("Macquarie") was finalised  in May 2016, which is a fixed term facility.   The loan is repayable in regular instalments over a 12-month period from the date of first drawdown of the loan.

“The loan with Macquarie replaces the US$ 25 million debt facility entered into in April 2015 and is used for general corporate purposes,” the Company elaborated. “The proceeds of the Facilities with Barclays S.A. and BCI will enable MRM to finance its capital expenditure requirements for the Montepuez ruby deposit in Mozambique and provide additional working capital.”

Janet Boyce, CFO of Gemfields, commented: "We are pleased to have agreed (to) these financing facilities after having considered a number of alternatives as well as other offers from various banks. The Facilities, together with Kagem's existing revolving credit facility of US$ 30 million with Barclays Bank in Zambia, provides Gemfields with the necessary funding to sustain its growth and expansion plans to increase annual production to approximately 20 million carats of rough rubies in MRM and more than 40 million carats of rough emeralds in Kagem within the next 3 years. Lastly they also assist in smoothing the Company's cash flows given the intermittent nature of revenue in-flows from the coloured gemstone auctions."