(All amounts in US$ unless otherwise specified)
VANCOUVER, Sept. 12, 2014 /PRNewswire/ - Capstone Mining Corp. ("Capstone") (TSX: CS) today announced that due to general market conditions it is discontinuing its previously announced offering of $300 million Senior Notes (the "Notes") due in 2022.
"The Notes offering was intended to opportunistically repay borrowings under our existing credit facilities," said Darren Pylot, President and CEO 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 ("SSRCF"), 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 US LIBOR plus 2.5% (adjustable in certain circumstances) and a standby fee of 0.56% on the undrawn balance of the facilities.
About Capstone Mining Corp.
Capstone Mining Corp. is a Canadian base metals mining company, focused on copper. We are committed to the responsible development of our assets and the environments in which we operate. Our three producing mines are the Pinto Valley copper mine located in Arizona, US, the Cozamin copper-silver mine in Zacatecas State, Mexico and the Minto copper mine in Yukon, Canada. In addition, Capstone has two copper development projects; the large scale 70% owned copper-iron Santo Domingo project in Region III, Chile, in partnership with Korea Resources Corporation, and the 100% owned copper-zinc Kutcho project in British Columbia, Canada, as well as exploration properties in Chile. Using our cash flow and strong balance sheet as a platform, Capstone's strategy is to continue to grow with mineral resource and reserve expansions and exploration, and through acquisitions in politically stable, mining-friendly regions. We will pace our growth with our financial capacity, ensuring we retain, as a priority, sufficient financial flexibility to meet the requirements of our existing operations and our committed development projects, while maintaining an adequate cushion to deal with market volatility and operating risks inherent in the mining industry. Our headquarters are in Vancouver, Canada and we are listed on the Toronto Stock Exchange (TSX).
Cautionary Note Regarding Forward-Looking Information
This document may contain "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"). These forward-looking statements are made as of the date of this document and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance
and reflect Company management's expectations or beliefs regarding
future events and include, but are not limited to, statements with
respect to the estimation of mineral reserves and mineral resources,
the realization of mineral reserve estimates, the timing and amount of
estimated future production, costs of production, capital expenditures,
success of mining operations, environmental risks, unanticipated
reclamation expenses, title disputes or claims and limitations on
insurance coverage. In certain cases, forward-looking statements can be
identified by the use of words such as "plans", "expects" or "does not
expect", "is expected", "outlook", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or statements that
certain actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved" or the negative of these
terms or comparable terminology. In this document, certain
forward-looking statements are identified by words including "may",
"future", "expected", "intends" and "estimates". By their very nature
forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Such factors include, among
others, risks related to actual results of current exploration
activities; changes in project parameters as plans continue to be
refined; future prices of resources; possible variations in ore
reserves, grade or recovery rates; accidents, dependence on key
personnel, labour pool constraints, labour disputes; availability of
infrastructure required for the development of mining projects; delays
in obtaining governmental approvals or financing or in the completion
of development or construction activities; and other risks of the
mining industry as well as those factors detailed from time to time in
the Company's interim and annual financial statements and management's
discussion and analysis of those statements, all of which are filed and
available for review under the Company's profile on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that
could cause actual actions, events or results to differ materially from
those described in forward-looking statements, there may be other
factors that cause actions, events or results not to be as anticipated,
estimated or intended. The Company provides no assurance that
forward-looking statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue reliance
on forward-looking statements.
SOURCE Capstone Mining Corp.