22/10/2012 - 11:38

Southern Cross lines up debt-finance for Sandstone

22/10/2012 - 11:38

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Southern Cross lines up debt-finance for Sandstone

Southern Cross Goldfields says it has a short-list of financiers to provide the necessary funding to complete the acquisition of the Sandstone gold project from Troy Resources.

Southern Cross said today that it had received indicative term sheets from a group of potential debt-providers, and it would mandate one party in the near future to proceed to completion.

The miner announced in August that it had reached agreement with Troy to acquire the Sandstone project for $5 million cash, a 2 per cent smelter royalty and more than 43 million options to acquire Southern Cross shares exercisable at 10 cents.

Southern Cross said financing activities for the Marda project were also progressing positively, with indicative term sheets also received in line with its expectations.

Debt financing for Marda is expected to be finalised by the December quarter.

Managing director Glenn Jardine said the acquisition of the Sandstone plant and camp was expected to halve the estimated capital cost of the Marda project.

“The debt markets are currently very much open for business and we are focused on securing a competitive financing package that will enable us to move ahead with completion of this important transaction and put SXG on a clear pathway to gold production in 2013,” Mr Jardine said.

At 11:30AM, WST, Southern Cross shares were up 2.2 per cent, trading at 4.5 cents. 

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