HGM.L Regulatory News (HGM)

2 Apr 2007 07:01

Highland Gold Mining Limited02 April 2007 HIGHLAND GOLD MINING LIMITED Refinancing of Syndicated Loan Complete Moscow, 2 April 2007 - Highland Gold Mining Limited ("Highland Gold", or the"Company") is pleased to announce the completion of a debt restructuringprogramme. The Company has raised US$90 million in new financing with two newdebt facilities with two Russian banks comprised of a US$60 million facilitywith MDM Bank and a US$30 million facility with GazpromBank. This debt restructuring is a key element of Highland Gold's capital managementplan and aligns the company's debt maturities with its business plans. The newfacilities reduce Highland Gold's cost of debt and provide greater flexibilitywhich is better suited to a growth focused company like Highland Gold.Additionally, this will allow the Company to reclassify these debt facilities aslong term borrowings in future regulatory accounting filings. Proceeds from the new financing facilities have been used to complete the earlyrepayment of the existing Syndicated Loan Facility (approximately US$25.6million) with the remainder of the funds being used to fund a large portion ofthe final project development costs at the Novoshirokinskoye polymetallicdeposit and ongoing development costs at the Mayskoye and Taseevskoye golddeposits. Novoshirokinskoye, a joint venture project between Highland Gold and Kazzinc, ispresently the most advanced project in the Company's growth pipeline with finalconstruction works now underway and commissioning anticipated in 2008. Commenting on today's announcement, James Cross, Chairman said, "When weannounced the increase in Barrick's shareholding in November we indicated wewould be reviewing options to raise funds to continue the development of thebusiness. These new banking facilities largely satisfy this funding requirement,underpinning the Company's development of Novoshirokinskoye and the ongoingdevelopment of Mayskoye and Taseevskoye. Furthermore, a number of leadingRussian and International Banks have already expressed their interest inproviding and/or participating in future project financing facilities forMayskoye and Taseevskoye and these will be investigated further in the lead upto the finalisation of each project's feasibility study." For further information please contact: Enquiries: London: +44 (0) 207 851 64 00 Moscow: + 7 (495) 777 31 55 E-mail: info@highlandgold.com Henry Horne, Managing Director Dmitry Yakushkin, Communications Director Dominic Palmer-Tomkinson, Head of Investor Relations Or, WMC Communications, Alex Glover on +44 20 7930 9030 This information is provided by RNS The company news service from the London Stock Exchange