Reed Resources Ltd (ASX: RDR) (Reed) has appointed Credit Suisse (CS) to act as arranger for a debt facility of $19 million for the working capital requirements for its 100% owned Meekatharra Gold Project located in the Murchison region of Western Australia. The Company has received a credit approved term sheet which is subject to detailed documentation.
The key features of the facility are summarised as follows:
- $19 million Senior Secured Term Loan Facility.
- Tenor of twelve months from first utilisation, with an option to extend a further six months.
- A hedging facility which includes 70,000 ounces in forward delivery contracts and 40,000 ounces in bought puts.
- Mining approval for the Batavia open pit is a condition precedent to utilisation (mining approval for the Bluebird and Surprise Stage 1 pits have been received, with the required approvals for the Batavia pit expected in the coming weeks).
Managing Director Luke Tonkin said: “The Credit Suisse facility, which replaces the previously announced $23M facility offer by another lender, provides the company with a flexible funding and hedging package which will not only provide funding for the development of Stage 1 of the Meekatharra project but will also allow the company to commence preliminary work on Stage 2 of the project in a shorter timeframe.”