Changes to the conditions of the loan agreement

Friday, 30 June, 2017
22/2017

The Management Board of KGHM Polska Miedź S.A. (“KGHM”) announces that on 30 June 2017 it decided to express agreement to  the changes to the conditions of the loan agreement signed by Sierra Gorda SCM on 8 March 2012, the signing of which was announced by the Company in regulatory filing no. 13/2012.

The nature of the financing will change from project finance to corporate credit, which will significantly decrease the limitations and duties of Sierra Gorda SCM and in particular will improve the elasticity of operating and financial activities of Sierra Gorda SCM. Moreover, the documentation related to financing will be modified, including guarantees issued by Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation and their term of validity will be maintained up to the end of the financing period, that is to 15 June 2021, since  the Sierra Gorda SCM mine did not achieve part of the production and cost parameters in the deadline specified in the original financing agreement.

The condition precedent to the issuance of the aforementioned guarantees is granting a re-guarantee of repayment of a specified part of payment by KGHM towards Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation. On 30 June 2017, the Management Board of KGHM granted permission to  issue a re-guarantee of repayment of a specified part of payment, if it is made by Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation towards the financing banks, in the amount equal to the pro rata share of KGHM, but no more than the amount of USD 180 million.

As at 30 June 2017, the amount of financing due to the loan agreement is around USD 760 million.

The changes will come into force once all of the formal conditions specified in the agreed upon documentation of the credit agreement of Sierra Gorda SCM have been met.

Legal basis: Art. 17 (1) of MAR (Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (Official Journal of the European Union dated 12 June 2014, no. L 173/1)

Newsletter email list: