Stornoway Diamond Corp Signs $20M Credit Facility

(IDEX Online News) – Stornoway Diamond Corporation has signed an unsecured non-revolving bridge credit facility of up to $20 million with Ressources Québec, a subsidiary of Investissement Québec, Stornoway’s largest shareholder, through its indirect wholly-owned subsidiary Diaquem Inc.

The money will be used in connection with the development of the Renard diamond project and for general corporate purposes, including costs relating to Stornoway’s ongoing project financing activities.

Stornoway President and CEO Matt Manson said: “This credit facility is intended to provide Stornoway with good funding flexibility as we pursue our project financing activities and begin the ramp-up to the capital programs anticipated at Renard in 2014 and 2015. With major regulatory authorizations in hand and the Renard mine road now open for construction traffic, Stornoway’s primary objective is the timely conclusion of our principal project financing arrangements.”

Under the facility, the Lender will loan up to an aggregate amount of $20 million to Stornoway in two parts. The first half is expected to be made available on or about October 2, and a second tranche of up to $10 million, each of which will bear interest at 12 percent per annum and be repayable on March 28, 2014. The lender has the discretion to determine whether to fund the second tranche and, if so, the specific amount. A commitment fee equal to 1 percent of the amount funded under each tranche is payable by Stornoway.