Silver miner Cobar brings in administrators
PERTH (miningweekly.com) – Silver miner Cobar Consolidated Resources (CCR) on Wednesday called in administrators after it failed to raise the required A$8-million to fund working capital and to meet its scheduled debt repayments.
The company said on Wednesday that it had appointed Stephen Longley, David McEvoy and Christopher Hill of PPB Advisory to act as administrators.
In February this year, the miner launched a share purchase plan (SPP) offering shareholders up to A$15 000 worth of new shares, each at a discount of 20% to the average price over a five-day period, up to the closing date of the offer.
The SPP was instituted after CCR was able to defer a scheduled debt repayment of A$1.9-million to the Commonwealth Bank of Australia from the end of December to the end of January, along with a A$3-million payment of the Magna bridging loan to the end of June this year.
At the end of December, CCR also reported a A$29.5-million loss for the interim period, down 1 734% on the previous corresponding period, as silver prices declined, with the company also reporting an impairment of A$28.5-million on its flagship Wonawinta silver mine.
The mine has experienced significant teething problems since pouring its first silver in 2012, as the orebody proved more complex than first thought, prompting CCR to make adjustments to its processing plant, which, in turn, increased capital expenditure, while the mine was unable to deliver on its 2.5-million-ounce production target.
As a result of the less-than-stellar performance at Wonawinta, CCR has been unable to generate sufficient cash flow to sustain its operations.
The company’s shares have been in a trading halt since March 17.
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