KEFI Gold, the parent company of the Tulu Kapi Gold Project, arranged equity placing to finance the Tulu Kapi Gold Project in Ethiopia.
The company raised GBP 13 million or 800 million birr capital in two stages from its 5,000 shareholders on the London Stock Exchange.
The placing is expected to yield approximately GBP0.5 million in net cash and allow a repayment of GBP 5.7 million in debts, which have accrued since the Company’s last capital was raised in 2020, according to the executives of the mining company.
The capital increase will allow Kefi to continue preparations for the Tulu Kapi Project and enable it to contribute its share to the Saudi Gold and Minerals joint venture and settle its liabilities.
According to Harry Anagnostaras Adams, Chairman of KEFI Gold and Copper, KEFI arranged the equity placing to tidy-up its balance sheet going into the years-end. The structure of the placing also contributes to the project financing of the Tulu Kapi Gold Project.
Kebede Belete (PhD), Chairman of KEFI Minerals Ethiopia Limited and Deputy Chairman of Tulu Kapi Gold Mines said “KEFI Directors and management themselves invested over USD two million, which is approximately 100 million birr in Wednesday’s capital raising in London.
“By this investment, combined with their shareholding of more than 10 percent in KEFI, this highly experienced senior team, which has also managed some of the world’s largest mining companies, demonstrates its full commitment to the development plans of the company, starting with Tulu Kapi,” he added.
“It is also pleasing that there has recently been a significant positive turning point in the conflict, which reinforces KEFI’s optimism that peace will soon be restored in Ethiopia. We work intensely with the Government and the stakeholders of the Tulu Kapi Gold Project to launch as early as possible during 2022,” Anagnostaras said.
KEFI Minerals Ethiopia Limited has already invested over USD 70 million into Tulu Kapi Gold Mines SC and plans to further invest over USD 300 million or 13 billion birr for Tulu-Kapi project development, financed by its already assembled consortium, which includes Africa’s leading gold plant designer, Lycopodium, Africa’s leading mining services contractor, Corica, along with other specialists and African focused mining financiers, according to Kebede.
The Tulu Kapi Gold Project consortium includes a major African multilateral development bank, the East African Trade and Development Bank, whose regional headquarters is in Addis Ababa, and the African Finance Corporation, a Nigerian-based development bank.
KEFI, in its statement, emphasized that it continues to work intensely with the Government and stakeholders of the Tulu Kapi Gold Project to launch extraction as early as possible. With the funding consortium, structure already identified and commitments are in place and given the advanced stage of preparations such as technical and legal due diligence, timing is principally dependent on the security situation being acceptable for launch.
According to Kebede, the modern discovery of the industrial scale gold deposit at Tulu Kapi was approximately 15 years ago and KEFI was invited to take control in 2014 to introduce the latest international standards to the project. The start of full gold production at Tulu Kapi remains targeted for 2024, with commissioning from the end of 2023.