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Mandalay Resources closes C$43M offering

Earlier this month, Mandalay announced the public offering of as well as a US$8 million convertible bridge loan
Mining trucks
Mandalay has mines in Sweden and Australia

Mandalay Resources Corp (TSE:MND) (OTCMKTS:MNDJF), the metals miner, said it had raised C$43 million gross from the sale of 359.4 million subscription receipts at $0.12 each.

That included a partial exercise of the over-allotment option for underwriters to purchase up to a further 15% of receipts at the same price, said the Toronto -based miner.

READ: Mandalay Resources announces pricing of offering

Earlier this month, the group, which has operating mines in Sweden and Australia, announced the public offering of as well as a US$8 million convertible bridge loan from an affiliate of CE Mining -- an investment fund advised by Plinian Capital Ltd, which is controlled by Mandalay Chairman Brad Mills.

The bridge loan has a term of one year, has an interest rate of 10% and will be convertible at CE Mining's option into Mandalay shares at a price per share equal to C$0.108 subject to adjustment.

Mandalay said the net proceeds of the financing are intended to fund working capital requirements, including capital development work at the Costerfield mine in Australia,  and tailings upgrade and capital development requirements at Bjorndal in Sweden.

Debt restructuring

The funds will also be used for debt restructuring, including establishing a cash reserve relating to the US$24.1 million principal amount outstanding of senior exchangeable gold bonds, and future planned exploration activities at high potential areas including at Costerfield, the Youle lode and deeper hole targets, and the emerging Aurora Zone at Björkdal.

In connection with the closing of the bridge loan, Mandalay has obtained a waiver from HSBC Bank Canada (HSBC) under the miner's revolving credit facility with the bank.

HSBC has waived any current breaches of the facility as well as any failure by Mandalay to comply with the financial covenants set out as at 31 December 2018 and 31 March 2019.

Contact Giles at [email protected]

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Mandalay Resources Corp. Timeline

February 20 2019

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