Caledonia Mining Corporation has raised US$150 million through a bond offering in the United States to help fund the development of its Bilboes gold project in Zimbabwe, a move the company says keeps it on track to begin major procurement later this year.
The miner said the bond issue attracted strong demand from US investors, with total orders exceeding US$600 million.
Caledonia had initially planned to raise US$100 million, but increased the size of the offering twice during the marketing process.
The deal eventually closed at US$150 million after underwriters exercised their full option to purchase additional notes.
The offering, which was launched last week, drew overwhelming interest, mainly from large US institutional investors.
Within three days, investor demand had surpassed US$600 million, more than six times the amount the company originally sought.
As a result, Caledonia first increased the offer to US$125 million before early investors exercised an option to buy an additional US$25 million in bonds, bringing the total raised to US$150 million.
The transaction was led by Cantor Fitzgerald and involved convertible senior notes, which pay interest but can be converted into shares under certain conditions.
The notes will mature in 2033 and carry an annual interest rate of 5.875%. Caledonia also entered into capped call transactions to limit potential shareholder dilution if the bonds are converted into equity.
After fees and hedging costs, the company said it expects to retain about US$130 million in net proceeds.
Caledonia chief executive Mark Learmonth described the strong investor response as a major vote of confidence in the company and its growth plans. He said:
“The successful Convertible Notes Offering, with the upsizing of the offering to US$150 million due to exceptionally strong support , marks a major milestone for Caledonia.
“Receiving more than US$600 million of demand from high-quality North American investors is a tremendous endorsement of our strategy, the quality of our assets, our operational track record, and the long-term prospects of the Company.”
The bond issue marks the first step in a four-part funding plan to bring the Bilboes project into production.
The second element involves gold price hedging. In December, Caledonia purchased put options that secure a minimum gold price of US$3,500 per ounce on 3,000 ounces a month from January 2026 to December 2028.
This is intended to protect cash flows if prices fall, support strong cash generation at Blanket Mine during Bilboes’ peak spending phase, and provide comfort to lenders.
The third stage is bank funding. In November 2025, Caledonia began discussions with Zimbabwean and South African banks for an interim facility of up to US$150 million, which the company expects to secure by mid-2026.
The final stage will be long-term project finance. Early talks with potential lenders have already begun, with a formal financing process expected to start this quarter.
This process is likely to take a year or more, as lenders carry out independent reviews of the Bilboes resource and feasibility study.
More: newZWire; Proactive
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