Harmony Gold, South Africa’s largest gold miner, chaired by South African billionaire Patrice Motsepe, is taking bold steps to unlock cheaper, more flexible financing for its growth ambitions, launching a $500 million offering of guaranteed senior unsecured convertible bonds due in 2031.

The Johannesburg-based company, as it seeks to diversify its funding sources and optimise its balance sheet, said on September 21, 2026, that the net proceeds from the offering will be used for general corporate purposes as it seeks to reduce its cost of capital and improve the efficiency of its funding structure.

Harmony targets lower cost of capital

The convertible bonds being conducted through an accelerated book-build process will be issued at 100% of their principal amount, with each bond carrying a principal value of $200,000. The bonds are expected to pay an annual coupon of between 1.5% and 2.0%, payable semi-annually, with the first payment scheduled for March 29, 2027. Unless previously redeemed, converted or cancelled, the bonds are expected to mature around September 29, 2031.

South African gold producer said the initial conversion price is expected to be set at a premium of between 35% and 40% above the reference share price. Based on the mining company’s stated assumptions, the bonds could be convertible into approximately 18.9 million Harmony ordinary shares, equivalent to about 2.9% of its current issued ordinary share capital.

Bondholders gain conversion and redemption rights

Harmony Gold Chief Executive Officer Beyers Nel said the offering represents a proactive approach to balance sheet management and will allow the company to diversify its capital sources.

“Our capital programme remains fully funded,” Nel said, adding that the company remains focused on long-term value creation for shareholders.

Under the terms of the offering, Harmony will have the option to redeem all, but not part, of the bonds at their principal amount plus accrued interest under specified conditions. Final terms are expected to be announced after pricing, with the issue date expected around September 29, 2026.

The company may exercise the redemption option from October 20, 2029, if the prescribed parity value reaches the required threshold for a specified period, or if at least 85% of the originally issued bonds have been converted, redeemed or cancelled.

Bondholders will also have the right to require redemption following certain change-of-control or delisting events. Harmony Gold said it may elect to settle conversions by delivering the underlying shares or by using a net share settlement mechanism designed to limit dilution.

Harmony expands capital-market options

Founded in 1950, Harmony Gold operates in South Africa, Papua New Guinea, and Australia. Total assets rose 63.88% to R125.99 billion ($7.89 billion), from R77.5 billion ($4.36 billion) a year earlier. Retained earnings grew by 187.98% from R13.29 billion ($832.86 million) to R38.28 billion ($2.4 billion) in its 2026 fiscal year.

The bond offering gives Harmony Gold access to additional capital while preserving flexibility in how it manages its funding structure. The company said the transaction is intended to enhance funding efficiency, diversify its sources of capital and optimise its overall funding profile.

The bonds are expected to be admitted to trading on the Open Market segment of the Frankfurt Stock Exchange within 30 days of the issue date, subject to the applicable requirements.

The securities are being offered only to qualified investors and are not being publicly offered in the United States, the United Kingdom, the European Economic Area or South Africa.