Molycorp Inc. said it plans to take advantage of a 30-day grace
period for a $3.36 million semiannual interest payment due Monday,
during which the struggling rare-earths elements miner and
processor plans to evaluate various options for restructuring its
debt load.
Greenwood Village, Colo.-based Molycorp said the decision won't
trigger any cross-default provisions in other outstanding debt
before the grace period ends and shouldn't affect its current
operations.
Earlier in June, The Wall Street Journal reported that the
company—the only U.S. miner and processor of rare-earths elements—
plans to file for chapter 11 bankruptcy protection as soon as this
month to reduce its roughly $1.7 billion of debt.
The plan marked a dramatic turn for Molycorp, which rode
temporary concerns of a shortage in rare earths—elements used in a
host of electronic devices—to a $6 billion market capitalization in
2011. But since then, China has relaxed restrictions on exports of
rare earths, oversupplying a market that is relatively small
compared with those of coal or iron ore. Amid the glut, Molycorp
has posted a three-year streak of annual losses through 2014.
Write to Tess Stynes at tess.stynes@wsj.com
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