South African miner Simmer & Jack Mines (Simmers) has entered into a $20-million forward gold sale with global financial services provider Deutsche Bank.
The gold miner will deliver 2 030 oz/m of gold to the financial services provider over a 12-month period, starting from November.
Simmers noted that the pricing of the gold sale was determined on a floor price of $850/oz.
The bank would also pay Simmers the difference between the floor price and the spot price on the day of delivery each month. An undisclosed maximum price for each small amount has, however, been agreed to by the parties.
The South African mining company used the $20-million, or about R139,6-million, to repay a R105-million bridging loan with Rand Merchant Bank.
The balance of the proceeds would be used for general working capital purposes.
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