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Sprott finances Novo Resources
Clayton Utz has advised lenders on acquisition financing for Novo Resources.
Tony Zhang
Firms: Clayton Utz (Sprott).
Deal: Clayton Utz has acted for Canadian-based investment manager and lender, Sprott Resource Lending (Sprott), on a four-year US$60 million credit facility to TSX-listed Novo Resources (Novo) for its acquisition of Millennium Minerals.
Area: Banking and finance.
Key Players: Perth banking partner Rohan Mishra led the firm’s deal team, with key support from special counsel Kate Casellas and graduate Luke Crofts.
Clayton Utz worked alongside Canadian law firm Davies in advising Sprott.
Deal Significance: Novo Resources has completed the acquisition of an existing mothballed mine in the Pilbara and refinanced the company by completing placements to the Sprott group and private entities.
“The transformational purchase delivers Millennium Minerals’ old Golden Eagle gold plant at Nullagine to Novo who has a significant in-ground resource just down the road,” Mr Mishra said.
Novo had set its deal to purchase Millennium Minerals early last month and with all the due diligence and paperwork now in place, the company has emerged as the proud owner of Millennium’s assets in the Pilbara, having parted with around US$51 million in its own stock for the privilege and agreeing to pay down the debt owing on the operation.
The funds are available in two tranches, with the first $35 million (subject to a lender’s 12.29 per cent cash discount for net proceeds of $30.7 million) drawn down and the remaining $25 million (subject to a lender’s 2 per cent cash discount) available to be drawn until 31 March 2021, at Novo’s sole discretion, upon delivery of a pre-feasibility study acceptable to Sprott on the company’s Beatons Creek gold project and the satisfaction of certain other conditions.
