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
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
Many banks and financial institutions are experimenting with containers in development environments, but when will they move into production? Containers are seen as the key to achieving the ultimate in information technology flexibility and agility. Containers work on both public and private clouds, and make it easy to build and deploy applications. The challenge for regulated industries is the cost and complexity of container security compliance. VM security compliance is already challenging, ...
The essence of data analysis involves setting up data pipelines that consist of several operations that are chained together – starting from data collection, data quality checks, data integration, data analysis and data visualization (including the setting up of interaction paths in that visualization). In our opinion, the challenges stem from the technology diversity at each stage of the data pipeline as well as the lack of process around the analysis.
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
Designing IoT applications is complex, but deploying them in a scalable fashion is even more complex. A scalable, API first IaaS cloud is a good start, but in order to understand the various components specific to deploying IoT applications, one needs to understand the architecture of these applications and figure out how to scale these components independently. In his session at @ThingsExpo, Nara Rajagopalan is CEO of Accelerite, will discuss the fundamental architecture of IoT applications, ...
SYS-CON Events announced today that MangoApps will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device. For more information, please visit https://www.mangoapps.com/.
SYS-CON Events announced today that Tintri Inc., a leading producer of VM-aware storage (VAS) for virtualization and cloud environments, will exhibit at the 18th International CloudExpo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Enterprise networks are complex. Moreover, they were designed and deployed to meet a specific set of business requirements at a specific point in time. But, the adoption of cloud services, new business applications and intensifying security policies, among other factors, require IT organizations to continuously deploy configuration changes. Therefore, enterprises are looking for better ways to automate the management of their networks while still leveraging existing capabilities, optimizing perf...
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
In his session at 18th Cloud Expo, Bruce Swann, Senior Product Marketing Manager at Adobe, will discuss how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects). Bruce Swann has more than 15 years of experience working with digital marketing disciplines like web analytics, social med...
SYS-CON Events announced today Object Management Group® has been named “Media Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
In the rush to compete in the digital age, a successful digital transformation is essential, but many organizations are setting themselves up for failure. There’s a common misconception that the process is just about technology, but it’s not. It’s about your business. It shouldn’t be treated as an isolated IT project; it should be driven by business needs with the committed involvement of a range of stakeholders.
SYS-CON Events announced today that EastBanc Technologies will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. EastBanc Technologies has been working at the frontier of technology since 1999. Today, the firm provides full-lifecycle software development delivering flexible technology solutions that seamlessly integrate with existing systems – whether on premise or cloud. EastBanc Technologies partners with p...
SYS-CON Events announced today that AppNeta, the leader in performance insight for business-critical web applications, will exhibit and present at SYS-CON's @DevOpsSummit at Cloud Expo New York, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. AppNeta is the only application performance monitoring (APM) company to provide solutions for all applications – applications you develop internally, business-critical SaaS applications you use and the networks that deli...
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, will explore the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences betwee...