Revett Mining (RVM.TO, NYSEMKT:RVM) announced it has signed an agreement with a major equipment financing company which lends Revett $5M with the company’s underground and some of its surface equipment as collateral. We think this is a good agreement as it allows Revett to raise $5M in a non-dilutive way as the company continues to work to restart the operations at the Troy mine in Montana. The interest rate of 6.25% is also very decent, so this equipment financing seems to be quite favorable.
Additionally, Revett has cancelled the credit facility with Société Générale which was expiring at the end of this year anyway. At this point in time, Revett’s only debt is the new equipment financing debt, which means the company still is in an excellent position to restart the production later this year and reach full production halfway next year.
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Disclosure: The author holds a long position in Revett Mining. Revett is a sponsor of the website. Please see our disclaimer for current positions.
