Caledonia Mining prices upsized $125m senior note placing
By Josh White
Date: Thursday 15 Jan 2026
(Sharecast News) - Caledonia Mining Corporation announced the pricing of an upsized private placing of $125m of 5.875% convertible senior notes due 2033 on Thursday, increasing the size of the offering from the previously announced $100m.
The AIM-traded firm said the notes, which would be issued to qualified institutional buyers under Rule 144A, would be senior unsecured obligations of the group and were expected to close on 20 January, subject to customary conditions.
Caledonia also granted initial purchasers a 13-day option to buy up to an additional $25m of notes, which would lift total proceeds to $150m if exercised in full.
The notes would carry a coupon of 5.875%, payable semi-annually from July 2026, and would mature on 15 January 2033 unless earlier converted, redeemed or repurchased.
Caledonia estimated net proceeds of $120.2m after fees and expenses, rising to around $144.4m if the overallotment option was exercised.
The company said it expected to use the proceeds to fund capped call transactions at an estimated cost of $12m, with the balance providing additional financial flexibility, including potential development of the Bilboes gold project in Zimbabwe and for general corporate and working capital purposes.
It said the initial conversion rate was set at 24.6837 common shares per $1,000 principal amount of notes, equivalent to a conversion price of about $40.51 per share.
That represented a conversion premium of roughly 25% to the last reported Caledonia share price on NYSE American on 14 January.
Conversion would be settled in cash, shares or a combination of both, at Caledonia's election, and would be subject to customary anti-dilution adjustments.
Caledonia said it had entered into capped call transactions with financial institutions to mitigate potential dilution from conversion of the notes, with an initial cap price of $56.72 per share, representing a 75% premium to the reference share price.
The company noted that hedging activity associated with the transactions could affect the trading price of its shares or the notes around the time of issue and over the life of the instruments.
It said the notes could not be redeemed before January 2030, except in limited circumstances, and could thereafter be redeemed only if Caledonia's share price reached at least 130% of the conversion price over a specified period.
Holders would also have the right to require the company to repurchase the notes for cash following certain fundamental change events.
At 1237 GMT, shares in Caledonia Mining Corporation were down 13.58% at 2,100p.
Reporting by Josh White for Sharecast.com.
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