JOHANNESBURG – Sibanye-Stillwater on Thursday further enhanced its liquidity position by concluding a forward gold sale arrangement with Citibank.
According to the agreement, Sibanye has received a cash prepayment of U.S.$125 million, approximately R1.75 billion, in exchange for the future delivery of 105,906 ounces, or 3,294 kilograms, of gold during the fourth quarter of 2019.
This is subject to a floor price of U.S.$1,200 per ounce and a cap price of U.S.$1,323 per ounce of gold.
The funding is expected to be accounted for as deferred revenue under International Financial Reporting Standards and will be applied towards the repayment of revolving credit facilities.
Neal Froneman, Sibanye chief executive, said that the transaction complemented the company's recent equity raise and is specifically designed to enhance our access to liquidity.