Lydian International Ltd (TSE:LYD) wholly-owned Armenian operating subsidiary has entered into a secured credit facility with Caterpillar’s (NYSE:CAT) UK financial services and leasing arm for a maximum principal amount of $42mln, the company said on Wednesday.
Proceeds of the Cat term facility will be used to purchase Cat mobile mining equipment for Lydian's 100%-owned Amulsar gold project in Armenia.
Construction at Amulsar started in October. First gold production is expected during the first quarter of 2018.
"We have crossed another major milestone in the development of the Amulsar gold mine and are extremely pleased to have Cat Financial support our future mining operations," said Howard Stevenson, Lydian's president and chief executive officer.
The Cat term facility is available to be drawn in multiple advances through June 2018. Each advance will be repayable over a 75-month term, inclusive of a six-month initial repayment grace period. The Cat term facility bears an interest rate of London interbank offered rate plus 4.5%. Principal security consists of specific equipment financed by Cat Financial. In addition, Lydian has provided an unsecured guarantee in favour of Cat Financial. All advances under the Cat term facility are subject to satisfaction of certain conditions.
Endeavour Financial is acting as financial adviser to Lydian.
Lydian shares were up 3.2% at C$0.32 on Wednesday.