Welcome!

News Feed Item

Asanko Gold Amends Red Kite Debt Financing

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 04/15/14 -- Asanko Gold Inc. ("Asanko" or the "Company") (TSX:AKG)(NYSE MKT:AKG) is pleased to announce that it has agreed terms to amend its existing project debt facility with a special purpose vehicle of RK Mine Finance Trust I ("Red Kite") to reflect the Company's plans to develop Phase 1 of the Asanko Gold Mine ("AGM"). Definitive agreements are expected to be executed during Q2 2014.

The terms of the amended agreement will be substantially similar to the Definitive Senior Facilities Agreement ("Agreement") that Asanko announced on October 24, 2013 for a US$150 million secured project debt facility for the Esaase Project. Since the acquisition of PMI Gold Corporation in February 2014, the Company has merged the two assets into the AGM, which will be developed in phases. The debt provided under the amended agreement will be specifically utilised for developing Phase 1 of the AGM. There are no costs payable by Asanko to Red Kite to transfer this facility to Phase 1 of the AGM.

The Agreement provides for two loan facilities: a US$130 million loan facility (the "Project Facility") and a US$20 million cost overrun facility (the "Overrun facility"). The Overrun facility is provided as an option available to the Company, should it be required. Performance under the amended agreement will be fully secured by the assets related to Phase 1 of the AGM only and will be guaranteed by the Company until Phase 1 project completion.

There are no gold hedging provisions, cash sweep requirements or other restrictions usually associated with traditional project finance facilities of this nature, so Asanko will not be prevented from pursuing its growth strategy.

In addition to the Agreement, Asanko also entered into an Offtake Agreement under which Asanko would sell its gold for the life of the mine to Red Kite at spot prices during a nine day quotational period following shipment. The terms of the Offtake Agreement will be amended to limit the gold to be delivered under the Offtake Agreement to a maximum of 2.22 million ounces. The amended Offtake Agreement will also provide Asanko with an option to terminate the Offtake Agreement once the loans are repaid for a specified fee, which is dependent upon the total amount drawn under the debt facility and the number of ounces delivered at the time of termination.

Asanko's President and Chief Executive Officer Peter Breese stated: "We are pleased to have amended our existing Agreement with Red Kite to reflect our revised project implementation plan following the creation of the Asanko Gold Mine. Phase 1, which is expected to provide 220,000 ounces of gold per year for the first five years of operation starting in 2016, is fully financed from our cash balance of US$255 million(1) plus this US$150 million debt facility."

The terms of the amended agreement are substantially similar to the Agreement, namely:

Project Facility Details ($130 million):


--  Interest rate of LIBOR + 6% with a one percentage minimum LIBOR rate; 
--  1.5% fee payable on drawdowns; 
--  Four year quarterly repayment schedule or early repayment at any time
    without penalty; and 
--  Conditions precedent to full drawdown principally are completion of the
    Phase 1 Project Plan with material outcomes substantially the same as
    the September 2012 Definitive Feasibility Study(2) ("DFS"). 
--  The Company will be required to make the first drawdown upon execution
    of the definitive amendment agreement and to draw a total of $60 million
    by the end of 2014. 

Overrun Facility Details ($20 million):


--  Interest rate of LIBOR +10% with a one percentage minimum LIBOR rate; 
--  3% fee payable on drawdowns; 
--  Three year quarterly repayment schedule and early repayment at any time
    without penalty; and 
--  Conditions precedent to drawdown are confirmation that the Company has
    sufficient funds with the Overrun Facility to complete Phase 1, that the
    Project Facility is fully drawn and that 4,000,000 Asanko share warrants
    have been issued to Red Kite. The warrants would be priced at a 25%
    premium to the 20 day volume weighted average price of Asanko at that
    time and have a 2.5 year term to expiry. 

Offtake Agreement Details:


--  100% of the future gold production from Phase 1 of the AGM to a maximum
    of 2.22 million ounces; 
--  Red Kite to pay for 100% of the value of the gold nine business days
    after shipment; 
--  A provisional payment of 90% of the estimated value will be made one
    business day after delivery; and 
--  The gold sale price will be a spot price selected during a nine day
    quotational period following shipment. 
--  Should the Company wish to terminate the Offtake Agreement, a
    termination fee will be payable according to a schedule dependent upon
    the total funds drawn under the Project and Overrun Facility as well as
    the amount of gold delivered under the Offtake Agreement at the time of
    termination. 

Enquiries:

For further information please visit www.asanko.com

Notes:


1.  Estimated cash balance as at February 6, 2014 which was the time of the
    close of the PMI Gold acquisition by Plan of Arrangement. 
2.  PMI Gold Corporation's Definitive Feasibility Study ("DFS") on the
    Obotan Project, published in September 2012. See filing on www.sedar.com

About Asanko Gold Inc.

Asanko's vision is to become a mid-tier gold mining company that maximizes value for all its stakeholders. Asanko's flagship project is the fully financed, multi-million ounce Asanko Gold Mine Project located in Ghana, West Africa.

Asanko is managed by highly skilled and successful technical, operational and financial professionals. The Company is strongly committed to the highest standards for environmental management, social responsibility, and health and safety for its employees and neighboring communities.

About RK Mine Finance

RK Mine Finance provides mining companies with project financing and metal off-take agreements for initiation or expansion of mine production and is part of the Red Kite group. Red Kite operates across the global metals industry from offices in Bermuda, Hong Kong, London, New York, Shanghai and Sydney. Investors in Red Kite funds include college endowments, foundations, family offices, pensions and other institutional investors.

Forward-Looking and other Cautionary Information

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address estimated resource quantities, grades and contained metals, possible future mining, exploration and development activities, are forward-looking statements. Although the Company believes the forward-looking statements are based on reasonable assumptions, such statements should not be in any way construed as guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices for metals, the conclusions of detailed feasibility and technical analyses, lower than expected grades and quantities of resources, mining rates and recovery rates and the lack of availability of necessary capital, which may not be available to the Company on terms acceptable to it or at all. The Company is subject to the specific risks inherent in the mining business as well as general economic and business conditions. For more information on the Company, Investors should review the Company's annual Form 20-F filing with the United States Securities Commission and its home jurisdiction filings that are available at www.sedar.com.

Neither Toronto Stock Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.

Contacts:
Alex Buck, Manager - Investor Relations
Telephone: +44-7932-740-452
Email: [email protected]

Greg McCunn, Chief Financial Officer
Telephone: +1-778-729-0604
Email: [email protected]

Asanko Gold Inc.
General enquiries:
[email protected]

RK Mine Finance
Grant Gilmour - Portfolio Manager
Telephone: +44 207 920 6185

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
WebRTC is about the data channel as much as about video and audio conferencing. However, basically all commercial WebRTC applications have been built with a focus on audio and video. The handling of “data” has been limited to text chat and file download – all other data sharing seems to end with screensharing. What is holding back a more intensive use of peer-to-peer data? In her session at @ThingsExpo, Dr Silvia Pfeiffer, WebRTC Applications Team Lead at National ICT Australia, looked at differ...
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, explored the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences between wh...
"Splunk basically takes machine data and we make it usable, valuable and accessible for everyone. The way that plays in DevOps is - we need to make data-driven decisions to delivering applications," explained Andi Mann, Chief Technology Advocate at Splunk and @DevOpsSummit Conference Chair, in this SYS-CON.tv interview at @DevOpsSummit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
"Logz.io is a log analytics platform. We offer the ELK stack, which is the most common log analytics platform in the world. We offer it as a cloud service," explained Tomer Levy, co-founder and CEO of Logz.io, in this SYS-CON.tv interview at DevOps Summit, held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA.
Adding public cloud resources to an existing application can be a daunting process. The tools that you currently use to manage the software and hardware outside the cloud aren’t always the best tools to efficiently grow into the cloud. All of the major configuration management tools have cloud orchestration plugins that can be leveraged, but there are also cloud-native tools that can dramatically improve the efficiency of managing your application lifecycle. In his session at 18th Cloud Expo, ...
In his session at @DevOpsSummit at 19th Cloud Expo, Robert Doyle, lead architect at eCube Systems, will examine the issues and need for an agile infrastructure and show the advantages of capturing developer knowledge in an exportable file for migration into production. He will introduce the use of NXTmonitor, a next-generation DevOps tool that captures application environments, dependencies and start/stop procedures in a portable configuration file with an easy-to-use GUI. In addition to captur...
"ReadyTalk is an audio and web video conferencing provider. We've really come to embrace WebRTC as the platform for our future of technology," explained Dan Cunningham, CTO of ReadyTalk, in this SYS-CON.tv interview at WebRTC Summit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Due of the rise of Hadoop, many enterprises are now deploying their first small clusters of 10 to 20 servers. At this small scale, the complexity of operating the cluster looks and feels like general data center servers. It is not until the clusters scale, as they inevitably do, when the pain caused by the exponential complexity becomes apparent. We've seen this problem occur time and time again. In his session at Big Data Expo, Greg Bruno, Vice President of Engineering and co-founder of StackIQ...
One of the hottest areas in cloud right now is DRaaS and related offerings. In his session at 16th Cloud Expo, Dale Levesque, Disaster Recovery Product Manager with Windstream's Cloud and Data Center Marketing team, will discuss the benefits of the cloud model, which far outweigh the traditional approach, and how enterprises need to ensure that their needs are properly being met.
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and Containers together help companies to achieve their business goals faster and more effectively. In his session at DevOps Summit, Ruslan Synytsky, CEO and Co-founder of Jelastic, reviewed the current landscape of D...
In 2014, Amazon announced a new form of compute called Lambda. We didn't know it at the time, but this represented a fundamental shift in what we expect from cloud computing. Now, all of the major cloud computing vendors want to take part in this disruptive technology. In his session at 20th Cloud Expo, John Jelinek IV, a web developer at Linux Academy, will discuss why major players like AWS, Microsoft Azure, IBM Bluemix, and Google Cloud Platform are all trying to sidestep VMs and containers...
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Dave McCarthy, Director of Products at Bsquare Corporation; Alan Williamson, Principal ...
DevOps and microservices are permeating software engineering teams broadly, whether these teams are in pure software shops but happen to run a business, such Uber and Airbnb, or in companies that rely heavily on software to run more traditional business, such as financial firms or high-end manufacturers. Microservices and DevOps have created software development and therefore business speed and agility benefits, but they have also created problems; specifically, they have created software securi...
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.