AIM-listed Beacon Hill Resources is reportedly facing financial problems following the vote by shareholders against debt restructuring and a £1.5m fuel injection into the company, with only enough cash to last for the next few days.
Rowan Karstel, CEO of Beacon Hill has said that an announcement could be expected in a few days before the company, which is the developer of the Minas Moatize coking coal mine in Mozambique, is anticipated to run out of cash.
The board expressed “extreme disappointment” that the requisite shareholder approval for all of the resolutions had not been obtained, adding that Beacon Hill only has adequate working capital until around mid-January 2015.
As such, Beacon Hill has appointed an insolvency practitioner to advise the company in respect of its ongoing ability to trade and the potential requirement for it to be placed into administration in the near term.
“It is clearly very regrettable that despite approximately 69% of shareholders who voted electing to vote in favour of the restructuring and funding resolutions, we fell short of the requisite 75% threshold to enable us to proceed to implement the proposals,” said Justin Farr-Jones, Chairman of Beacon Hill.
He added that the funding and restructuring Proposals were the culmination of considerable negotiation and hard work over a lengthy time period in very difficult market conditions, and that shares would remain suspended from trading on AIM until any other viable funding alternatives were found. Failing this, Beacon Hill would be put into administration.
As a consequence, payment of $4.1 million under its existing $10 million senior debt facility remain due for repayment by the end of January.