Online Reporter
Sikhulekelani Moyo
Zimpapers Business Hub
CALEDONIA Mining Corporation has raised US$150 million from the issuance of senior Convertible Notes (debt securities), providing the company with a strong, flexible source of long-term funding to support its operations.
The success of the capital raise demonstrates the confidence investors have in the company.
Caledonia will use the net proceeds from the Convertible Notes offering to pay the approximately US$12 million cost of the capped call transactions, which provides the company additional financial flexibility and enhanced options with respect to several group operations.
The funding will also be used to finance the development of the Bilboes gold project in Zimbabwe, as well as general corporate, operational and working capital requirements.
The Bilboes Gold Project is strategically important to Caledonia, forming the cornerstone of the company’s ambition to transition from a single asset producer into a multi-asset, mid-tier gold producer in Zimbabwe.
Gold is strategically important to Zimbabwe as a leading source of foreign currency and export earnings, a key pillar supporting monetary stability through the gold-backed ZiG currency, and a critical driver of employment and livelihoods.
Zimbabwe’s gold output rose by 17 percent to an all-time high of 46,7 tonnes in 2025, up from 36,48 tonnes in 2024, according to Fidelity Gold Refinery (FGR), the country’s sole gold buyer.
Caledonia recently issued Convertible Notes with an aggregate value of US$125 million at an annual interest rate of 5,875 percent in a private placement to persons reasonably believed to be qualified institutional buyers.
A senior convertible note is a priority debt security that offers investors the opportunity to convert their investment into equity shares of the issuing company.
Both startup and established companies use these debt instruments to raise funds because they provide a flexible path to capital while ensuring investor recourse.
Particularly attractive to investors seeking high rewards from company growth and initial public offerings (IPOs), senior convertible notes offer a balance between debt advantages and potential equity gains.
In a statement, the old producing company said its US$150 million, seven-year convertible senior notes offering received exceptionally strong support from institutional investors in the United States.
The company said investor demand exceeded US$600 million after three days of marketing, which led to an upsizing of the initial offering from US$100 million to US$125 million.
Eventually, US$150 million worth of Convertible Notes were allotted after initial purchasers exercised options to buy a further US$25 million ofthe notes.
