19/02/2014 - 16:07

Atlantic set for extra funding

19/02/2014 - 16:07

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Embattled miner Atlantic is once again set to obtain extra funding from major shareholder Droxford International, which has proposed a new $32.6 million loan facility.

Part of the Windimurra plant that was damaged by fire earlier this month.

Embattled miner Atlantic is once again set to obtain extra funding from major shareholder Droxford International, which has proposed a new $32.6 million loan facility.

The funding proposal follows a major fire that destroyed part of Atlantic’s Windmurra vanadium plant, and the failure of subsidiary Midwest Vanadium to make interest payments to holders of senior secured notes.

Atlantic said today that a majority of the note holders had agreed to the proposed new loan facility.

Under the funding proposal, $3.6 million would be released to Midwest Vanadium in the “very near term to allow it to meet immediate commitments”.

The funding proposal also involves a standstill on Midwest Vanadium’s interest reserve account and interest payment obligations under the notes until at least August.

Atlantic said this would provide a sound basis for it to work through the insurance claim from the recent plant fire.

It has previously said it could take up to nine months to repair the fire damage.

Atlantic has estimated the cost of the fire, including damage as well as business interruption, would be in the vicinity of $100 million.

The company is working with its insurers regarding progressive payments under its comprehensive policy, which covers damage from the fire that occurred early this month.

Atlantic shares are currently in voluntary suspension, having last traded at 17.5 cents.

The company has requested the suspension to remain in place until it can provide more definitive details on its funding. 

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