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Ivanhoe Mines draws down interim US$100M loan

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Ivanhoe Mines draws down interim US$100M loan

Ivanhoe Mines Ltd. secured an interim loan of US$100 million from CITIC Metal Group Ltd. to ensure its exploration and development efforts continue apace.

The company said Aug. 9 that the loan, bearing interest at 6%, is expected to be repaid from proceeds of a C$723 million investment agreement it signed in June with Citic Ltd.'s CITIC Metal Co. unit, which awaits regulatory approvals.

"While we do not anticipate having to use the funds from the interim loan before the CITIC Metal investment closes, the funds are in our bank account," Executive Chairman Robert Friedland said in the statement.

Friedland gave a "secured limited-recourse guarantee and share pledge" to back the company's obligations under the loan, which boosts Ivanhoe's working capital to about US$165 million. The chairman's controlled affiliate, Newstar Advantage Ltd., pledged 15.4% of Ivanhoe's shareholding as security.

Ivanhoe is pushing forward several advanced-stage projects including the Kamoa-Kakula and Kipushi base metals properties in the Democratic Republic of the Congo and the Platreef platinum group metals property in South Africa.