By: Creamer media

The company explains that the bonds will have a tenor of five years and will have a fixed coupon rate of 12.5% a year, with interest payable in quarterly instalments.

Settlement of the bonds is expected to occur on or around March 27, subject to the satisfaction of customary conditions precedent.

Net proceeds from the bond issue will be used to repay Lucara's existing $220-million senior secured project finance debt package; to fund two years of interest on the bonds on a dedicated debt service retention account; and to cover the residual costs related to the underground project (UGP) at its Karowe mine, in Botswana.

The company says it intends to make an application to list the bonds on the Oslo Alternative Bond Market.

Completing the $350-million bond financing, along with the C$165-million raised in its equity offering in January, provides Lucara with sufficient access to capital to incur the $779.2-million capital cost of the UGP, of which $469.4-million was incurred as at December 31, 2025 as contemplated in the company's updated feasibility study.

Following closing of the bond financing, the company says it expects to have sufficient funding to complete the UGP without further financing, provided the project moves forward on schedule and the company is able to meet its production and revenue forecast.

"Following our upsized and highly successful equity private placement in January, we are very pleased to announce the completion of this bond issuance marking the completion of the final step in securing the full financing package for the Karowe underground project,” says Lucara president and CEO William Lamb.

He adds that the bond issue attracted strong interest from a range of international investors, reflecting continued confidence in the exceptional quality of the Karowe mine and its long-term value potential.

“With the project now fully financed, we can focus all our efforts on executing the remaining development work and advancing Karowe toward a new phase of sustainable, high-value diamond production."

Lucara notes that Nemesia, a private entity controlled by the trusts settled by the late Adolph Lundin, was allocated $30-million in the bond financing.