London-listed Avocet to restart talks over its struggling gold mine

19-09-2017

London-listed Avocet Mining will resume talks with its Societe des Mines de Belahouro (SMB) subsidiary on Friday as it works to save the struggling gold operation from insolvency.

The West Africa miner suspended its shares for about a month in London and Oslo earlier this year after failing to deliver its accounts on time.

Avocet said production was delayed following problems with late payments at its Inata mine in Burkina Faso, which is operated by SMB.

SMB has grappled with keeping the mine operating, and the firm faces possible insolvency after the expiry of a freeze on loan repayments.

The boards of SMB and Avocet failed to come up with an extension agreement at a meeting last week and said they would consider "all available options", including insolvency.

The meeting will reconvene this Friday so the board can reassess the status of discussions with creditors, SMB's liquidity position and the available options.

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"Given the current status of discussions, it is unclear whether agreement on a restructuring of the balance sheet can be reached before SMB has exhausted all available sources of financing," Avocet said in a statement.

Avocet owns 90 per cent of the Inata gold mine, which poured its first gold in December 2009 and produced 72,485 ounces of gold in 2016.

The company's share price has dropped from a high of 2,862p in 2011 to 25.5p today.

Source: http://www.cityam.com/271764/london-listed-avocet-restart-talks-over-its-struggling-gold