Americas-focused copper mining company Capstone Copper has priced and upsized its senior notes offering to $600m (C$860.26m), increasing the amount from the initially planned $500m.
The notes, due in 2033, are senior unsecured obligations of the company and carry an interest rate of 6.75% per annum.
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They will be backed by Capstone’s subsidiaries that guarantee the company’s senior secured revolving credit facility.
The company plans to use the gross proceeds from the offering to repay project financing debt at its Mantoverde subsidiary in Chile, reduce debt on its senior secured revolving credit facility and for general corporate purposes.
The issue price of the notes is 100% of the principal value, and interest will be paid semi-annually. Settlement is expected to take place on or around 25 March, subject to customary closing conditions.
The notes are being offered in the US to qualified institutional buyers under Rule 144A of the US Securities Act of 1933 and to non-US investors under Regulation S of the Securities Act.
In Canada, the offering is being conducted through a private placement under prospectus exemptions.
The offering was not registered under the Securities Act, so the notes cannot be publicly sold or traded in the US without an applicable exemption.
Capstone Copper owns and operates the Pinto Valley copper mine in Arizona, US; the Cozamin copper-silver mine in Zacatecas, Mexico; the Mantos Blancos copper-silver mine in Chile’s Antofagasta region; and a 70% stake in the Mantoverde copper-gold mine in Chile’s Atacama region.
Additionally, it owns the fully permitted Santo Domingo copper-iron-gold project, located around 30km north-east of Mantoverde in the Atacama region, along with a portfolio of exploration properties across the Americas.
In June 2024, the company produced the first saleable copper concentrate at its Mantoverde Development Project in Chile.
