TIDMIMIC
RNS Number : 7842K
Intl Mining & Infrast Corp PLC
21 April 2015
21 April 2015
INTERNATIONAL MINING & INFRASTRUCTURE CORPORATION PLC
("IMIC" or the "Company")
Bond Restructuring Proposal
International Mining & Infrastructure Corporation plc (AIM:
IMIC), the Company focused on unlocking the value of iron ore in
Africa, is pleased to announce that it has invited the holders of
its US$30 million 8.75 per cent. bond due 2016 ("2016 Bondholders")
(the "Bond") to approve a proposal to modify certain terms and
conditions constituting the 2016 Bond (the "Proposals"), in line
with those announced on 17 April 2015 in connection with certain
other outstanding bonds.
Key Proposals
-- To amend the final redemption date by extending it by 5 years
from 30 October 2016 to 30 October 2021;
-- To amend the interest rate by decreasing the coupon payable
on the Bond by 3.75 per cent., from 8.75 per cent. to 5 per
cent.;
-- To increase the repayment amount to be paid at final
maturity, to compensate for the reduction in interest rate, to
132.059 per cent. of the nominal amount of the Bond;
-- By inserting a new accelerated repayment covenant which will
oblige IMIC to make immediate repayment to the 2016 Bondholders if
Ethelbert Cooper is removed from the office of director and
Non-Executive Chairman of the Company by a shareholder resolution;
and
-- To amend the conditions relating to the interest payable date
by making the payment of the interest from semi-annual to
annual.
Ethelbert Cooper, IMIC's Chairman, commented:
"Following a review of our debt position, we have made certain
proposals to the 2016 Bondholders in relation to restructuring of
the Bond. The Bond proposals have been designed to rebalance the
group's financing obligations."
Background to the Proposals
The Bond
On 30 October 2013, the Company issued an initial tranche of the
US$40 million 8.75 per cent. Bond due 30 October 2016 (ISIN
XS0913978382). The actual amount drawn down on the 2016 Bond was
US$30,000,000. The interest payable on the 2016 Bond was at the
rate of 8.75 per cent. The nominal value of each of the 2016 Bonds
is $100,000, which is repayable on 30 October 2016. The Company and
certain of the 2016 Bondholders have held discussions regarding
certain amendments to the 2016 Bonds.
IMIC announces that it is inviting 2016 Bondholders to consent
to certain amendments to certain terms and conditions, being
changes in the extension of the maturity date, interest payment
date and conditions, repayment amount and accelerated repayment
provisions relating to the Bond (described briefly in the table
below) as proposed by IMIC.
Rationale for the Proposals
The considerable fall in international iron ore prices over the
past 15 months has created a challenging environment for IMIC. As
China experienced accelerated economic growth over the past decade,
its consumption of the principal raw material used in steelmaking
increased substantially, climbing to 70 per cent. of
globally-traded iron ore, contributing to a significant rise in
iron ore prices. However, the recent slowdown in demand for
resources from China due to stabilisation of economic growth, as
well as increasing global supply of the resource from the major
producers, whose high-volume, low-cost iron ore production strategy
is aimed at boosting market share and sustaining profit margins,
have together had a negative impact on ore prices. These prices
have declined very significantly since November 2013, putting
adverse pressure on smaller, marginal producers, which have
struggled to remain profitable in the current market
environment.
The funding environment for junior iron ore developers is
extremely difficult at this time due to the very low iron ore
prices. In the circumstances, IMIC considers that it is prudent to
restructure the debt obligations of IMIC both from the perspective
of interest reduction and extending the term of the debt.
The Board of IMIC believes that it is unlikely that the Company
will generate cash from its operations in the near term and the
bond Proposals are therefore designed to rebalance the Group's
financing obligations.
Accordingly, IMIC would like to change the maturity date and
interest rate of the 2016 Bonds and make payment of the interest
annual.
The Board of Directors of IMIC has carefully considered the
Proposals and believes that the Proposals described in the consent
solicitation memorandum, to be sent to 2016 Bondholders on 21 April
2015, provide the most appropriate solution to the funding
challenges.
IMIC has confidentially discussed these amendments to the 2016
Bond with certain of the 2016 Bondholders and, based on the 2016
Bondholders' responses during those discussions, IMIC expects them
to be supportive of the Proposals.
Quorum and Required Votes
The quorum required for the proposed amendments to be considered
is one or more holders of the Bond or proxies representing 75 per
cent. in principal amount of the Bond outstanding.
To be passed, the extraordinary resolution in respect of the
Proposals requires a majority of not less than 75 per cent. of the
votes cast. If passed, the extraordinary resolution shall be
binding on all the 2016 Bondholders, and each of them shall be
bound to give effect to it accordingly.
Expected Timeline
The following summary of key dates is qualified in its entirety
by the more detailed information appearing in the consent
solicitation memorandum. 2016 Bondholders should take note of the
following dates in connection with the consent solicitation.
This timetable is subject to change and dates and times may be
extended or changed by the Company in accordance with the terms of
the consent solicitation, as described in this consent solicitation
memorandum. Accordingly, the actual timetable may differ
significantly from the timetable below.
Event Date and Time
_________________________________________________________
__________________
Announcement of consent solicitation and proposals 20 April 2015
Revocation deadline 10:00 a.m. (London time) on 1 May 2015
Latest time for 2016 Bondholders to deliver or procure delivery
on their behalf
to the issuer of a valid instruction revoking previously
submitted
consent instructions.
Voting deadline 10:00 a.m. (London time) on 5 May
2015
Deadline for 2016 Bondholders to deliver or procure delivery on
their behalf
to the issuer of a consent instruction in favour of the
extraordinary resolution.
Deadline for appointing a proxy in respect of the 2016 Bonds
5:00 p.m. (London time) on 1 May
2015
Announcement of the results of 2016 Bondholders extraordinary As
soon as reasonably practicable
Resolution after the voting has concluded and,
in any event, within 14 days of the
Voting Deadline.
The complete terms and conditions of the consent solicitation
are described in the consent solicitation memorandum, copies of
which may be obtained by contacting Sanjiv Radia, the information
and tabulation agent for the consent solicitation, as set out
below. Additional information concerning the consent solicitation
may be obtained by contacting the paying agent.
This press release is for informational purposes only, and the
consent solicitation is being made only pursuant to terms of the
consent solicitation memorandum. The consent solicitation is not
being made to, and consents are not being solicited from, holders
of the 2016 Bonds in any jurisdiction in which it is unlawful to
make such solicitation or grant such consent. Neither the Company
nor the paying agent makes any recommendation as to whether or not
2016 Bondholders should deliver any consents. Each 2016 Bondholder
must make their own decision as to whether or not to deliver a
consent.
Further Information
A complete description of the terms and conditions of the
consent solicitation is set out in the consent solicitation
memorandum. Further details about the transaction can be obtained
from:
The Company
Sanjiv Radia
Tel: +44 (0) 20 7290 3340
Email: sanjiv.radia@imicplc.com
The Paying Agent
Deutsche Bank AG, London Branch
Paul Yetton
Tel: 020 7547 6657
Email: paul.yetton@db.com
For further information, please contact:
International Mining & Infrastructure www.imicplc.com
Corporation plc
Ethelbert Cooper, Chairman
Haresh Kanabar, Chief Financial +44 (0) 20 7290
Officer 3340
Strand Hanson Limited - Financial www.strandhanson.co.uk
& Nominated Adviser +44 (0) 20 7409
James Spinney / Ritchie Balmer 3494
/ James Bellman
Pareto Securities Limited - Sole www.paretosec.com
Broker +44 (0) 20 7786
Guy Wilkes / Will Slack 4370
Deutsche Bank AG - Paying Agent www.db.com
Paul Yetton +44 (0) 20 7466
5000
Buchanan - Financial PR www.buchanan.uk.com
Mark Court / Sophie Cowles +44 (0) 20 7466
5000
About IMIC
IMIC's strategy is, in conjunction with its partner AIOG,
working to develop fundable solutions to infrastructure provision
for iron ore resources in West and Central Africa. In support IMIC
will seek to acquire interests in iron ore projects that would
benefit from a specific infrastructure solution. IMIC made its
first investment with the Dec 2013 acquisition of Afferro Mining
Inc, taking ownership of four iron ore deposits in Cameroon, the
most advanced asset being Nkout. IMIC plans to continue to develop
its assets, including accelerating the feasibility studies of the
smaller Ntem deposit, which is located only 80km from Kribi deep
water port.
IMIC's focus will initially be on iron ore opportunities in West
and Central Africa. The demand for iron ore is currently being
driven by China which consumes approximately 70 per cent. of the
world's current annual production. As the urbanization of China
continues demand for iron ore is expected to remain at significant
levels through to 2030. The iron ore projects currently identified
in West and Central Africa have the potential to produce at least
400 million tonnes of iron ore each year. This would establish
Africa as a global player, alongside Australia and Brazil, in the
iron ore industry.
In order to help deliver its infrastructure solutions, IMIC and
AIOG have established strategic partnerships with various Chinese
state owned companies. These companies are involved in railway and
port construction, power, iron ore beneficiation and iron ore
marketing. These relationships are intended to give IMIC and AIOG
the ability to work with relevant governments and financial
institutions to deliver infrastructure solutions and to guarantee
the onward sale of iron ore in China and other emerging world
markets.
IMIC shares are traded on the London Stock Exchange's AIM market
under the ticker symbol IMIC.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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