Harmony Gold Mining, the world’s fifth- and South Africa’s third-largest gold producer, on Monday said it has raised R979-million before costs by placing shares.
The company said it would use the proceeds to reduce its debt levels.
This would help the company strengthen its balance sheet despite the current international financial turmoil.
Harmony aims to have zero net debt by June 2009.
The company said the capital raising was done through the issue of shares for cash in the open market with about 10,5 million shares, or the equivalent of 2,6% of the company’s issued share capital.
These shares were placed between November 25 and December 19 this year at an average subscription price of R93,20 a share, which compares favourably with the weighted average share price on the JSE over the same period of R92,79 a share.
The cost of the placement was approximately R15-million, or 1,5% of the value of shares issued.
Harmony also reported that it has repaid R1,25-billion of the R2-billion Nedbank debt, which was repayable by December 2008.
The Nedbank loan facility of R750-million is now repayable by December 2009.
Given the current global economic slowdown, the company said it recognised that its pipeline of projects “is the future of the company” and it would regularly review its cash flow to ensure that it supports the continuation of its projects.
“Harmony has reaffirmed its commitment to its capital expenditure plans,” the company said. — I-Net Bridge