The board of Aim-listed BlueRock Diamonds, together with the business rescue practitioners (BRPs) of its subsidiary Kareevlei Mining, have decided to put BlueRock in administration, as it cannot expect meaningful proceeds from Kareevlei’s business rescue process.
Allister Manson and Trevor Binyon have subsequently been appointed as joint administrators of BlueRock, effective June 5.
Kareevlei, which owns the Kareevlei diamond project, in South Africa, was put into business rescue in February owing to its high debt levels.
Kareevlei’s BRPs deem it unlikely that BlueRock, as a non-independent creditor, will receive a final distribution from Kareevlei, as the mine needs to first settle payments to secured creditor Teichmann South Africa, which was owed £3.4-million as of February.
BlueRock in February suspended its shares from trading on the Aim, pending clarification on the subsidiary’s financial position.
Operations at Kareevlei remain suspended, and negotiations are progressing for the restructuring of the operation. The BRPs have managed, however, to renew the mining licence for the mine, which is a positive development.