Photo by: Bloomberg
TORONTO (miningweekly.com) – US miner Allied Nevada Gold has filed for Chapter 11 bankruptcy protection after protracted weak precious metals prices and a heavy debt load had forced it to restructure its debt.
On Tuesday, Reno, Nevada-based Allied Nevada, which currently operated the Hycroft gold/silver mine in the state, said under the proposed financial restructuring, it expected to pay in full all its creditors and vendors, which at the end of the third quarter ended September held $543-million in debt.
The company had been experiencing operational difficulties at Hycroft, prompting it to lower its 2014 production guidance, while it was looking to finance the first phase of the $768-million Hycroft mill expansion.
Allied Nevada explained that noteholders and secured lenders owning or controlling more than 67% of its notes had committed to supporting the restructuring. The company and supporting noteholders had also agreed to a $78-million secured debtor-in-possession credit facility to maintain business-as-usual operations during the restructuring process.
Allied Nevada’s NYSE-listed stock on Monday closed at $0.86 apiece, before the NYSE and TSX suspended its trading on Tuesday morning. The New York-quoted stock had shed 84% of its value in the last 12 months.