What are the chances that really low financing will occur for Geologix when a company like Capstone (with its assets, balance sheet & positive cash flow) threw in the towel last week? I wonder how low of a financing deal is being sought by Geologix?
Capstone Mining cancels $300-million (U.S.) offering
2014-09-12 09:07 ET - News Release
Mr. Darren Pylot reports
CAPSTONE MINING DISCONTINUES PLANNED OFFERING OF $300 MILLION SENIOR NOTES
Due to general market conditions, Capstone Mining Corp. is discontinuing its previously announced offering of $300-million senior notes due in 2022. All amounts are in United States dollar unless otherwise specified.
"The notes offering was intended to opportunistically repay borrowings under our existing credit facilities," said Darren Pylot, president and chief executive officer of Capstone. "While the $300-million we were looking to raise was available, the proposed interest rate exceeded what we were prepared to pay for that purpose.
"We currently have very low-cost credit facilities, which, when combined with our strong cash position, strong cash flow from operations and the undrawn portion of our existing credit facilities, give us the flexibility to only consider financing opportunities that are aligned with our cost of capital criteria," continued Mr. Pylot.
The new $300-million senior secured revolving credit facility, which was intended to close concurrently with the notes, has also been discontinued. Capstone's existing $200-million senior secured corporate revolving term facility and $200-million senior secured reducing revolving corporate credit facility mature in October, 2017, and January, 2016, respectively. Both have an interest rate of U.S. London interbank offered rate plus 2.5 per cent (adjustable in certain circumstances) and a standby fee of 0.56 per cent on the undrawn balance of the facilities.
We seek Safe Harbor.