LONDON, Feb. 23 /CNW/ - Namibian Minerals Corporation (NAMCO) today
announced that it is placing some of its South African subsidiary companies
into liquidation, which is a provisional winding-up order which will be made
final in approximately six weeks.
Following the disruption to operations by the accident to its NamSSol
mining system in January and the resultant cash flow impact, the Company had
been urgently seeking financing to address its working capital requirements,
in particular to secure the interests of its creditors. Meanwhile, the Company
continued to pursue an insurance claim and expected a build-up in production
while commissioning of its new Nam 2 seabed crawler continued offshore
Namibia.
The Company had been progressing a number of financing options. On 12
February 2001 the Company announced that Canaccord Capital (Europe) Limited
("Canaccord") had sold to investors outside Canada six million common shares
for proceeds of US$8.25 million and US$2 million principal amount of 8% series
A convertible debentures for gross proceeds of US$10.25 million, subject to
filing of a short-form prospectus and to regulatory consents. Canaccord had
advised the Company that it was confident of raising up to US$20 million. At
the same time, the Company was advanced in discussions with a number of
parties, including major participants in the diamond industry, for a bridging
facility, pending completion of the above financing. The Government had
pledged N$20 million of participation. In addition, the Company was finalising
the sale of its least efficient and least productive vessel MV Ivan Prinsep
for US$4.4 million.
However, while offering a three month capital repayment moratorium, the
Company's Bankers have not provided sufficient certainty as to their
intentions after three months, nor were they willing to release security over
the MV Ivan Prinsep to cover a sum due to them and release surplus proceeds
for working capital purposes. A Term Sheet provided to the Company on 15
February 2001 set out these terms. Subsequent discussion and a revised term
sheet have failed to elicit the comfort which the Company requires for its
potential new investors. This uncertainty and mounting pressure from its
creditors has left the Company with no alternative than to seek liquidation of
its South African subsidiaries. The Company is committed to continuing
discussions with its Bankers to seek a reasonable and long term solution to
the present position.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS OF NAMIBIAN MINERALS
CORPORATION
Alastair Holberton
Chairman & CEO
Neither The Toronto Stock Exchange nor the Namibian Stock Exchange
have reviewed the information herein and does not accept responsibility
for the adequacy or the accuracy of the above.
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This Media Release contains forward looking statements that involve
a number of risks and uncertainties. Among the important factors that
could cause actual results to differ materially from those indicated
by such forward looking statements are operational factors, general
economic conditions and the risk factors detailed from time to time
in the Company's periodic reports and registration statements filed
with the Securities and Exchange Commission.
Sad.
PHIL |
