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Shanta Gold says new bank still working on due diligence after Tanzania changes

Investec has offered a new US$50mln loan facility that will replace the gold miner’s existing US$40mln arrangement
Picture of gold and dollars
Shanta owns the New Luika gold mine in Tanzania

Shanta Gold Limited (LON:SHG) said Investec Bank is continuing due diligence on the potential impact of changes to the mining and fiscal regime in Tanzania.

Investec has offered a new US$50mln loan facility that will replace the gold miner’s existing US$40mln arrangement with EXIM Bank.

READ: Shanta on track for 80,000 ounces and unlikely to be deflected by political rumblings in Tanzania

Part of the new money has been earmarked to pay back US$15mln of convertible loan notes, which have a 13.5% coupon.

At September 30, Shanta said it had total liquidity of US$13.6mln including a cash balance of US$8mln and access to the undrawn unrestricted Exim Bank facility totalling of US$5.6mln out of US$7.5 mln.

Shanta said it would provide a further update on the debt restructuring to shareholders and the holders of the loan notes by 31 March 2018.

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