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ASANKO Gold said its operating subsidiary Asanko Gold Mines (AGM) would repay inter-company loans that existed between its joint venture partners following the strengthening of its balance sheet.
This would allow “… the partners to begin realising a return on their respective investments,” said Greg McCunn, CEO of Asanko Gold, the Toronto-listed firm that has a 50% stake in AGM. The other half of AGM is owned by Gold Fields.
Gold Fields paid AGM $10m in line with an investment it made in the Ghanaian gold miner in 2018. In terms of that transaction – which delivered Asanko Gold from significant indebtedness – Gold Fields agreed to pay two sums of $10m each over and above its initial $200m investment in the company, assuming the Esaase gold mine in Ghana reached certain production milestones.
In addition, AGM is benefiting from an improved dollar gold price, stable production, as well as conclusion recently of a new revolving credit facility worth $30m with South African lender, Rand Merchant Bank, said McCunn.
As at August 31, 2019 Asanko Gold held approximately $14.7m in cash with working capital of $16m. The Asanko Gold Mine Joint Venture held approximately $44.6m in cash, gold bullion and gold receivables, with no external debt.