Absa Bank Limited has successfully refinanced and upsized Harmony Gold Limited’s existing $250million Term Debt to a three year $350million facility.
Absa Bank acted as Bookrunner, Co-ordinator and Mandated Lead Arranger.
The transaction was oversubscribed with the debt syndicated to a total of eight Lenders, including three new Lenders. This allowed Harmony to broaden its banking group, bolster liquidity and achieve its global growth ambitions.
Absa Bank is the largest lender in the new Term Debt which further cements their position as one of Harmony’s core relationship banks.
An oversubscription on Harmony’s debt raising is a fantastic result for Harmony. Bank liquidity has strengthened for the mining sector despite a challenging operating environment given the local policy uncertainty, so the oversubscription talks to the depth of Harmony’s bank relationships and the right market read on transaction price and structure.
Harmony’s previous facility was set to mature early in 2018, and the gold mining company was looking to refinance its existing facility to allow it to expand its scope to fund its capital expenditure and growth plans in both South Africa and Papua New Guinea.
Ultimately, this transaction is a demonstration of how Absa partners with clients to help them realise their growth ambitions. The bank is able to deliver on its mandate and has the capability to sell syndicated facilities to local and international financial markets. Most importantly, it also indicates that there is still investment appetite for South African mining companies from offshore investors.
Absa Bank Limited (Absa Bank) is a wholly owned subsidiary of Barclays Africa Group Limited, which is listed on the Johannesburg Stock Exchange and is one of Africa’s largest financial services groups.
Meanwhile, Absa Bank Limited has successfully concluded a five year $100 million Special Facility Agreement with the China Development Bank (CDB). This is the first major transaction between the two lenders and is geared towards providing funding to Small and Medium Enterprises (SME). This will also benefit BAGL’s existing and prospective SME clients across the continent, which will be reached through its 12-country presence.
The initial drawdown is based on Absa’s current funding needs, and may be increased in the future to assist with new funding opportunities within BAGL’s operations.
“We are glad to partner with CDB on this landmark transaction, which also echoes the 2017 BRICS theme, ‘Stronger Partnership for a Brighter Future’ ”, said Craig Bond, Head: Partnerships, Joint Ventures and Strategic Alliances at Barclays Africa Group Limited.
China Development Bank, one of the biggest lenders in Africa, was founded in 1994 as a development financial institution under the leadership of China’s State Council. The bank has assets of circa $2 trillion, and is the world’s largest development finance institution. Furthermore, CDB is the largest Chinese bank for foreign investment and financing co-operation, long-term lending and bond issuance