Eight Zimbabwean banks have joined forces to provide Caledonia Mining with an interim financing facility of up to US$150 million to develop Bilboes, which could become Zimbabwe’s biggest single gold mine.
The deal highlights the growing use of syndicated lending in Zimbabwe, where banks pool resources to finance large projects that may be too big for one institution to fund on its own.
The facility, arranged by Stanbic Bank and CBZ Bank through CBZ Capital, brings together Stanbic, CBZ, Central African Building Society, FBC Bank, FBC Crown Bank, First Capital Bank, NMB Bank and ZB Bank.
This allows Caledonia to access a larger pool of funding while spreading the risk among several lenders.
The US$150 million facility will run for three years, with an option to extend it by a further year. It is structured in two parts, a US$50 million revolving credit facility and a US$100 million term loan, which has an option to increase by another US$50 million.
The funding will help Caledonia keep up the momentum on Bilboes while it continues discussions with regional and international lenders for longer-term financing.
The deal is the third part of a four-pillar funding strategy announced earlier this year. Caledonia has already completed a gold price hedging programme and raised about US$130 million in net proceeds from a US$150 million convertible notes offering in January.
The remaining pillar is long-term project finance, for which discussions with potential lenders are ongoing.
Caledonia CEO m Mark Learmonth says the latest facility shows the company’s ability to raise funding from different sources.
“With the successful completion of our hedging programme, convertible notes offering and now the US$150 million interim financing facility, we will have successfully delivered three of those four pillars and substantially advanced the funding framework for the project,” he said.
Initial groundworks at Bilboes are underway, with major construction scheduled for 2027 and 2028. Bilboes is projected to produce about 200,000 ounces of gold in its first full year of operation in 2029. The mine is expected to produce a total of 1.55 million ounces over its projected 10.8-year lifespan.
