Shares in Petra Diamonds Limited (LSE:PDL, OTC:PDLMF) rose 43% on Friday after the company announced an agreement in principle with key financial stakeholders on a long-term refinancing package.
The move follows 18 months of internal restructuring, including the sale of non-core mines and cost-saving initiatives, aimed at simplifying the business.
Under the proposed deal, the maturity of Petra’s senior secured bank debt will be extended to December 2029, subject to lender approval, while its 9.75% senior secured second lien notes will be extended to March 2030.
The refinancing also includes a $25 million rights issue at 16.5 pence per share, underwritten by existing shareholders.
Vivek Gadodia, interim joint chief executive, said the bespoke refinancing solution would support cash preservation and allow Petra to continue with extension projects at its remaining mines.
The company has signed agreements with a group of noteholders and major shareholders representing around 63% of its share capital to support the refinancing.
The shares rose 5.26p to 17.52p.