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JOHANNESBURG (miningweekly.com) – London Mining’s efforts to secure a substantial investment have progressed as the Sierra Leone-focused iron-ore explorer enters “detailed negotiations”.
The LSE-listed group on Monday said the proposed investment – if successful – would take several weeks to implement.
The possible investment, with a deal structure under consideration, would secure funding for the life-of-mine expansion of London Mining’s Marampa iron-ore mine in Sierra Leone.
It would also enable a material cash injection into the company, significantly diluting the existing equity and leading to a revised capital structure.
This came as London Mining warned of insufficient liquidity to continue to trade through the current financial period without raising further finance.
“[The] funds [secured] from Afreximbank are not expected to be available in the required time period with discussions on structure ongoing. The company's lenders are working constructively with us to enable investment into the group and, in addition, are currently considering the provision of further finance,” the company said in a statement.
London Mining's share price on the LSE fell to 10p a share on Monday, down nearly 60% on Friday's close of 24.5p a share.