LUCARA SUCCESSFULLY PLACES US$350.0 MILLION BOND
Lucara Secures $350 Million Bond to Refinance Debt and De-Risk Karowe Underground Completion
On March 12, 2026, Lucara Diamond Corp. announced the successful placement of US$350.0 million in senior secured bonds with a five-year tenor and a 12.5% fixed coupon rate. This follows a series of distressed financial updates in early 2026, including a "financial hardship" exemption for a $165 million CAD private placement. The bond proceeds will be used to: - Repay the existing US$220.0 million senior secured project finance debt. - Fund a two-year interest reserve (Debt Service Retention Account). - Cover remaining capital costs for the Karowe Underground Project (UGP). - The Lundin family (via Nemesia S.a.r.l.) participated with a US$30.0 million allocation.
This news is Material - Positive because it effectively removes the "Going Concern" risk that has plagued the company since mid-2025. - Liquidity Solvency: The company had previously exhausted its project facility, working capital facility, and shareholder standby undertaking. This bond, combined with the January $165M CAD equity raise, provides the "sufficient access to capital" required to meet the $779.2 million total UGP cost. - Debt Terms: A 12.5% coupon is expensive, reflecting the company's recent technical defaults and the inherent risk of underground development. However, the five-year tenor pushes the maturity past the 2028 target for commercial production, providing a necessary runway. - Strategic Backing: Continued participation by the Lundin family (US$30M in bonds, following significant equity participation) signals unwavering support from the primary stakeholder.
Lucara operates the 100%-owned Karowe Mine in Botswana, world-renowned for producing large, Type IIa diamonds (e.g., several stones >1,000 carats). The flagship project is the Karowe Underground Project (UGP), designed to extend the mine life to at least 2040 by transitioning from open-pit to underground mining. The project is currently in the capital-intensive shaft-sinking and equipping phase, with commercial production targeted for H1 2028.