3 February 2021
Dominion Diamond Mines ULC announced today that it has completed the previously announced sale of the Ekati Mine and associated assets to Arctic Canadian Diamond Company Ltd. (“Arctic”), a company formed and owned by funds and accounts managed by DDJ Capital Management, Brigade Capital Management, LP and Western Asset Management Company, LLC. The Alberta Court of Queen’s Bench (the “Court”) approved the sale pursuant to an order issued on December 11, 2020.
Arctic has acquired substantially all of Dominion’s assets, excluding Dominion’s interest in the joint venture agreement and liabilities relating to the Diavik Diamond Mine, in consideration for the assumption of various liabilities owing to Dominion’s creditors, employees, suppliers and surety bond holders, including assuming US$70 million of Dominion’s outstanding indebtedness under its existing revolving credit agreement and the reclamation obligations of the Ekati mine. In addition, Arctic will receive a new US$85 million fully funded working capital facility ranking behind the first lien lenders. “This transaction significantly reduces our debt obligations, and provides sufficient liquidity to fund our operations, invest in future growth and allow the Company to emerge with a materially stronger balance sheet,” said Ms. Kristal Kaye, Chief Financial Officer.
In March 2020, the Company made the decision to suspend operations at the Ekati mine to safeguard its employees and Northern communities from the threat of COVID-19. As a result, the Ekati mine was put on care and maintenance and a minimal crew remained at site to maintain the mine during this period. The Company initiated a 10-week phased restart in November 2020 and returned to full operations on January 20, 2021. It is anticipated that the full recall of employees back to work will be completed no later than February 25, 2021.