Nordgold Converts Rouble Loan to US Dollars
Amsterdam, 10 April 2012 - Nord Gold N.V. (“Nordgold”) (LSE: NORD) has signed cross-currency swap agreements with various banks. The total amount of the currency swap is 11 billion roubles.
The size of the currency swap covers the loan Nordgold had received from Sberbank in March this year. As a result, the loan’s currency has been effectively changed from roubles to US Dollars at the exchange rate of approx. 29.3:1. The loan’s annual interest rate is now 5.6%.
Message from CFO
We are very satisfied with the terms of the cross-currency swap. This operation has allowed Nordgold to mitigate its exposure to foreign exchange risk. Moreover, it has brought the all-in interest rate under 6 per centSergey Zinkovich, Chief Financial Officer of Nordgold
As previously announced, the loan was used to repay Nordgold’s outstanding debt to OAO Severstal and its affiliates ("Severstal") of approximately US$ 360 million. This repayment completed all debt arrangements between Nordgold and Severstal and reflected the formal separation of the two companies announced on 14 March 2012. Nordgold retains a strong balance sheet and will continue to finance its capital expenditure and dividend programmes through the company’s generated cash flow.
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About the company
Nordgold (LSE: NORD) is an established pure-play emerging-markets gold producer, with operations in Burkina Faso, Guinea, Russia and Kazakhstan.Nordgold is a young and dynamic company. Since its establishment in 2007, it has expanded rapidly through acquisitions and organic investment, achieving a rate of growth unmatched in the industry during that period. By 2011 the company’s gold production was 754 Koz.Nordgold has eight active mines, two development projects, five advanced exploration projects and a broad portfolio of early exploration projects and licenses.Nordgold’s target is to produce 1 Moz of gold from existing mines and development projects by 2013. This target is underpinned by company’s gold reserves of 8.2 Moz and resource base of 22,7 Moz of gold and 103 Moz of silver.