UPDATE 1-Firstgold mulls sale of company, shares sag
Thu Apr 23, 2009 11:02am EDT
reuters.com
(In U.S. dollars, unless noted)
TORONTO, April 23 (Reuters) - Firstgold Corp's (FGOC.OB) (FGD.TO) shares fell 13.5 percent on Thursday after it said it is considering selling the company, after two primary lenders declared the miner in default of debt covenants.
The California-based miner said it is "actively considering various financing, restructuring and strategic alternatives" and has hired Haywood Securities to assist in the process.
In a statement, Firstgold Chief Executive Steve Akerfeldt said the company has begun discussions with "three interested partners" about a possible sale of the company.
It also suspended crushing activity at its Relief Canyon mine in Nevada and put the operation on care and maintenance until it can obtain new financing.
The company has about $3.7 million in payables that cannot be repaid until new financing has been secured, it said.
Firstgold fell into default on $2.4 million in loan agreements in December, but was able to sign a forbearance agreement with lenders giving them a standstill agreement until April 30.
However, Firstgold said the two primarily lenders terminated the forbearance period on Wednesday and declared defaults on the debt.
The company's Toronto-listed stock was down 2.5 Canadian cents, or 13.5 percent, at 16 Canadian cents.
($1=$1.23 Canadian) (Reporting by Cameron French; editing by Rob Wilson) |
