03/07/2013 - 15:00

ASIC halts Swan Gold raising

03/07/2013 - 15:00

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ASIC halts Swan Gold raising
Swan Gold Mining's Davyhurst processing facilities.

Long-running attempts to revive Swan Gold Mining have hit a brick wall, with the company unable to complete a planned $15 million capital raising despite boasting a high-powered board of directors.

The company announced today that the Australian Securities and Investments Commission had refused its request to extend the closing date for the share placement.

The closing date had already been extended twice, and on May 13 the company said it planned a third extension to May 30.

However, it disclosed today that it was notified by ASIC on May 28 that the application for relief was refused.

“The company is at present considering its options moving forward and will provide an update as soon as additional information is available,” it said in a statement.

The restructuring was being led by Swan Gold’s executive chairman Michael Fotios, who also chairs investment syndicate Investmet.

In March this year, Swan Gold assembled a powerful board of directors, with the appointment of Azure Capital chair John Poynton, experienced company director and Allion Legal principal Craig Readhead and former banker and Oakajee Port & Rail finance director Wayne Zekulich.

Azure was advising Swan Gold on the $15 million capital raising, which was one of the final steps in a long and complex recapitalisation.

The company has relied on a loan agreement with Investmet, to provide up to $3 million for working capital purposes.

Investmet also took a big swag of Swan Gold shares, valued at $4.4 million, through a debt-for-equity swap.

However, it appears other investors were deterred by the company’s commodity focus and history.

Its principal asset is the Davyhust-Mt Ida gold project north of Kalgoorlie, which has been on care and maintenance since 2008.

The company’s shares are suspended.

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