Amaroq (LSE:AMRQ) agreed an amended and restated revolving credit facility with Landsbankinn and Gunvor Group that doubles its capacity to US$70 million, replaces the existing US$35 million facility and ties Gunvor to an offtake for gold from the Nalunaq mine.
The financing is intended to reduce Amaroq’s cost of funding and bolster working capital as the Greenland-focused mine developer enters this year’s exploration season and completes final construction and commissioning of Phase 2 of the Nalunaq processing plant while production cash flows build.
Interest will accrue at Term SOFR plus a 7.50% margin with step-downs to 6.25%, 5.00% and 4.50% as last-twelve-month EBITDA exceeds CAD 25 million, CAD 50 million and CAD 70 million respectively, the facility carries a 0.55% origination and amendment fee (US$385,000) and matures on 1 May 2028.
The RCF is secured by property and operational equipment mortgages, share pledges over subsidiaries, bank account pledges and a licence transfer agreement, may be drawn during the availability period subject to customary conditions precedent and ongoing compliance with financial covenants, and may be used for general corporate purposes.
Landsbankinn provides the lending platform and continuity of support while Gunvor, described by Amaroq as one of the world’s largest physical commodities traders, supplies market access and will offtake Nalunaq gold to support the company’s metals expansion strategy.
"We are very pleased to have executed this agreement with Landsbankinn and Gunvor, doubling the size of our revolving credit facility to $70 million," said Ellert Arnarson, Amaroq CFO.
