HomeBase MetalsSundance Resources restructure engagement process commences

Sundance Resources restructure engagement process commences

The enngagement is with the Sundance Resources’ noteholders and will assist in making recommendations to the board about restructuring options to best position the company for the future.

Sundance Resources engaged Mark Eames as part of it advisory team to provide additional support for the Sundance assignment.

Eames was formerly Head of Iron Ore Assets at Glencore and has extensive experience in iron ore with both Rio Tinto and Glencore.

Specifically, he has intimate knowledge of the African iron ore industry and has worked on developments in the Republic of Congo, where Sundance’s Nabeba deposit is located.

The company anticipates that Eames will join the Sundance board in the event the restructuring process reaches a satisfactory outcome.

Sundance CEO Giulio Casello says that the capital restructuring work currently underway is critical to cementing the position of the company and that the project is widely recognised as being in the front rank of iron ore projects globally.

Sundance Resources appointed specialist resources sector advisory firm RFC Ambrian to assist with assessing capital restructuring proposals in June this year.

To date, the company presently has convertible notes on issue with a total face value of $93.5 million and a total redemption value of $116.8 million.

Apart from $2.5 million due on 31 December 2016 to Hanlong, the remainder of the convertible notes are due on 23 September 2017. There is an on-going obligation to make interest payments on any of the convertible notes except for those held by Hanlong. The Hanlong notes can be converted to equity at either party’s discretion.

Sundance Resources reports quarterly activities

Sundance continued to reduce its operating costs through the June quarter which ended with $2.871 million in cash and deposits.

Its total cash outflow for the period was $1.476 million excluding interest which was below the forecast cash expenditure of $1.9 million for the quarter and compared favourably to $5.2 million in the March 2016 quarter.

In addition, during June Casello and Mark Eames held discussions on the future of the Mbalam Nabeba iron ore project in both the Congo and Cameroon.

Positive discussions were held with the Prime Minister of Cameroon, the newly appointed Prime Minister of Congo, the Minister of Mines for Cameroon, senior representatives of the Department of Mines in Congo and other government officials.

The meetings provided the opportunity for both Sundance and the host governments to reiterate their support for the project and the commitment by all parties to work together to move the project forward.

The government continues to pursue this actively with Chinese authorities and the selected EPC contractor.

“Our preferred development option is for the Cameroon Government and the Chinese EPC contractor to sign the EPC contract for the development of the rail and port infrastructure,” says Casello.

Sundance supports this approach, but continues to review other development options.