Continental suspends trade amid finance woes

South Africa-focused miner Continental Coal says it could be forced to call in administrators unless it can recapitalise the company in order to pay off its convertible notes.

Continental today requested a voluntary suspension from trading as it works towards negotiating a refinancing arrangement with noteholders and other creditors.

Continental has $US6 million in convertible bonds which were due to mature in November last year and a further $US10 million in bonds due to mature next month.

The West Perth-based company's board appointed an independent special committee in November last year to review refinancing proposals and engage with potential funders.

Continental said its financial position had been affected by lower than expected production at its Penumbra coal mine due to a lack of availability of continuous miners.

"At this point, no restructure and/or refinancing arrangements have been agreed that are acceptable to all parties," the company said.

"If no acceptable restructure and/or refinancing arrangements can be agreed in the near term, the board considers that the appointment of a voluntary administrator to the company in Australia may be necessary, as it will have insufficient funds to meet the repayment obligations on the convertible notes and other creditors."

Continental, which is dual-listed on the Australian Stock Exchange and the Alternative Investment Market, signalled last year it planned to list on the Johannesburg Stock Exchange but has admitted the process will be delayed by the company's refinancing efforts.

Its shares last traded at two cents.