South Africa’s Petra Diamonds has closed a US$244mn debt facility with a consortium of three banks.

A first R1.6bn (US$180mn) tranche, signed with Absa and FirstRand Bank, through its Rand Merchant Bank (RMB) and First National Bank (FMB), includes a 64-month amortising term facility (ATF) of R800mn (US$92mn), a 70-month revolving credit facility (RCF) of R300mn (US$35mn) and a working capital facility of R500mn (US$57mn).

Another US$60mn tranche, signed with the International Finance Corporation (IFC), includes a 64-month ATF of US$35mn and a 70-month RCF of US$25mn.

Petra confirms the overall ATF is priced at Jibar (rand facility)/Libor (US dollar facility) plus 4% margin, and is repayable by way of five semi-annual payments commencing in March 2016, with the last payment due in March 2018.

The RCF is priced at Jibar/Libor plus 5.5%, and is repayable by September 2018.

The working capital facility is subject to annual renewal, with an interest rate of South African prime less 0.5%.

The facilities are secured on Petra’s interests in the Cullinan, Finsch, Koffiefontein, Kimberley Underground and Williamson mines, but guarantee has been issued.

The new loans represent a US$108mn increase and a reorganisation of Petra’s existing debt facilities, to provide greater flexibility for the firm’s expansion plans. They will help finance the expansion of the Finsch and Cullinan mines, as well as Petra’s other operations and the group’s general working capital needs.

Johan Dippenaar, Petra’s CEO, says: “This financing is an important and independent validation by the lenders of the quality of Petra’s asset base and our strong management team. These facilities further strengthen our balance sheet and lend assurance to the company’s ability to deliver on its core objective of rolling out its stated expansion plans and ramping up production to 5 million carats per annum by 2019.”

Financial close was reached on November 16, 2012, and the facilities are now available for drawdown.