News Column

New World Resources Starts Contingency Sale Of Operating Subsidiaries

July 2, 2014

Tom McIvor

LONDON (Alliance News) - New World Resources PLC Wednesday said it has started a contingency sale process for its operating subsidiaries, in case its debt restructuring plan collapses.

In June, the company said it had agreed provisional terms of a debt restructuring, which would see the outstanding debt under its existing notes fall to EUR450 million, from EUR775 million, and cash debt servicing costs decline. It wants to launch a cash tender to repurchase its existing notes in exchange for new debt instruments.

The Europe-focused coal producer said on Wednesday that it has now secured an underwriter for EUR25 million of new equity required as part of the deal, but that in order to obtain commitments to its plan it made slight revisions to the senior unsecured notes cash tender part of the deal.

It has also implemented contingency planning in case the restructuring deal does not go ahead and has now put its operating subsidiaries on sale to cover this possibility.

New World Resources said that, should its plans all go ahead, the contingency operations will no longer be necessary and the sale process will end.

The company also said it has agreed to an alternative restructuring term sheet with certain holders of senior secured notes, which it will use as a back up plan in case the deal falls through.

New World Resources shares were down 11% to 23.00 pence on Wednesday.

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Source: Alliance News

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