DENVER, COLORADO - MAY 5, 1997 #97-011
11:00 AM MST
CONSOLIDATED NEVADA GOLDFIELDS CORPORATION
ANNOUNCES US$45 MILLION FINANCING COMMITMENT
Consolidated Nevada Goldfields Corporation (CNGC) announced
today that the
Company has received a commitment from Standard New York, Inc. and
Standard Bank London Limited (Standard) to make available US$45 million in
credit facilities for the restructuring of the Company's
existing bank debt and the
provision of a comprehensive hedging facility. Standard forms a part of the
Standard Bank Group based in Johannesburg, South Africa, one of the largest
banking groups in Africa. The Group has extensive merchant-banking
facilities and world-wide experience.
The commitment by Standard is subject to certain conditions; primarily
satisfactory completion of legal and engineering due-diligence reviews of the
Company's six operating mines and negotiation of definitive documentation,
including the specific terms of certain coverage ratios and covenants. Due
diligence will commence May 5, 1997 and is planned to take approximately
six to
eight weeks. Definitive documentation and settlement of the terms and
conditions are expected to be completed within the same period of time.
The commitment would provide US$30 million in term debt to be
repaid over five
years and bear interest at LIBOR plus 2.25 percent. The proceeds from
the term
debt are to be used to refinance the Company's existing high-interest
Mexican
bank debt and the Company's remaining balance on its gold loan with
Internationale Nederlanden Capital Corporation (ING) and for
general corporate
purposes.
When consummated, the credit facility would provide a US$15 million
credit
facility to underpin a 400,000 gold-equivalent ounce hedging facility.
Both the term debt and hedging facility would be corporate debt secured
by the
assets of the corporation.
The Company has pursued a debt restructuring as previously announced and the
effect of the proposed restructuring is expected to significantly reduce the
Company's interest expense primarily with respect to its Mexican debt.
Alex Bissett, President and Chief Executive Officer, stated he was pleased
to be
working with Standard and felt the opportunity to reduce the high
borrowing cost
for the Company was a major step in the ongoing effort to transform
CNGC into a
profitable mid-sized mining company.
Consolidated Nevada Goldfields Corporation is a Denver based
multi-national
mining company with six producing mines and over 1,500 employees. The
Company has proven and probable reserves of 560,000 ounces of gold, 47
million ounces of silver and 27 million pounds of copper. The Company
currently trades on the Toronto exchange under the symbol KNV, on NASDAQ
under the symbol KNVCF and on the Stuttgart, Frankfurt and Berlin exchanges,
under the symbol CNV.
- -30-
