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PERTH (miningweekly.com) – ASX-listed Atlantic has inked a scheme implementation deed with shareholder Droxford International under which all the company’s shares would be acquired for 0.3c each.
Droxford currently holds a 17.4% interest in Atlantic and is the company’s largest creditor, with some A$332.5-million owing under convertible bonds and promissory notes.
In May last year, the two companies entered into a forbearance agreement, under which Droxford agreed to forbear and not take any action to accelerate any of its convertible bond or promissory note debts until October 2015, subject to certain conditions.
This forbearance was subsequently extended until April this year, and with the implementation deed now signed, it had been further extended. The forbearance agreement would be in place until the earliest of the scheme failing to become effective, Atlantic’s independent directors recommending a competing proposal, or 30 business days after the scheme becomes effective.
If the scheme was not implemented, Droxford would be entitled to pursue its rights against Atlantic under the convertible bonds and promissory notes.
Atlantic pointed out on Friday that the cash consideration represented an implied market capitalisation of A$464 272 for Atlantic.
Atlantic in February unveiled plans to repurchase its Windimurra vanadium project, in Western Australia. With the assistance of Droxford, the company had submitted a proposal for the administrators to enter into a deed of company arrangement to acquire the Windimurra project.
Atlantic in February last year called in administrators for its operating subsidiary Midwest Vanadium, which owns the Windimurra project, after the company’s noteholders and major shareholders were unable to agree on the restructure of Midwest Vanadium.