London-listed Petra Diamonds has advised of a refinancing endeavour it aims to have completed before the end of the year.

The company has, over the past 18 months, been focused on internal restructuring efforts, which have resulted in the sale of the Koffiefontein and Williamson mines and a more streamlined business and operating model.

As part of the internal restructuring, Petra has engaged certain of its financial stakeholders to refinance the group’s senior secured bank debt facilities, as well as 9.75% senior secured second lien notes.

The debt facilities are currently set to mature in January, while the notes are due to mature in March.

The company has agreed a non-binding term sheet with the senior secured bank lender in respect of the company’s R1.75-billion revolving credit facility, which stipulates a new maturity date of December 2029, as well as a reduction of the facility to R1-billion by June 2029.

The refinancing with the lender will also include a revised margin, an updated financial covenant package and updated cashflow protocols and basket limits.

Petra expects to enter into a binding term sheet or commitment letter with the lender by September 10.

In respect of the notes, Petra has executed a lock-up agreement with a working group of holders of the notes (that hold about 86% of the notes by value), as well as a backstop agreement with certain shareholders of the company that represent 63% of Petra’s issued share capital.

Petra aims to have the notes refinanced with a maturity date of March 2030. 

The company will also undertake a rights issue to raise gross proceeds of about $25-million by issuing new shares at a price of 16.5p apiece. The rights issue will be underwritten by the backstop providers.

Shareholders who wish to support the refinancing and underwrite the rights issue, including participating in the backstop fee, should contact the company within the next ten business days to accede to the equity backstop agreement.

Meanwhile, Petra ended its 2025 financial year with higher net debt of $264-million and 33% lower revenue year-on-year at $206-million, despite having reported a 1% improvement in diamond production to 2.42-million carats.

The group has set its production guidance at between 2.4-million and 2.8-million carats for the 2026 financial year, which will ramp up to between 2.7-million and 3.1-million carats by the 2027 financial year.

Petra operates the Cullinan and Finsch diamond mines in South Africa, which both have expansion projects under way to unlock long-term value.

The company’s first tender for the 2026 financial year already garnered $25-million in revenue from the sale of 245 000 ct, compared with the last tender for the 2025 financial year that delivered $21-million in revenue from 283 970 ct sold, which shows market improvements in like-for-like prices for rough diamonds.