Struggling iron ore miner Pluton Resources has fallen back into the hands of receivers and managers, less than six months after the board regained control of the company, as part of a new restructuring proposal.
Pluton’s first ranking secured creditor General Nice Resources has appointed Bryan Hughes and Daniel Bredenkamp from Pitcher Partners as receivers and managers, while the company has entered voluntary administration with the appointment of Vince Smith and Sam Freeman of EY.
“GNR’s appointment of the receivers forms part of a recapitalisation and restructure proposal for the company that has been accepted by the board and by other key stakeholders,” Pluton said in a statement.
“The proposal will see GNR and its associates providing significant financial support to Pluton over the coming months.”
Under the terms of the proposal, GNR will provide a $28 million facility to Pluton, by way of a 36-month convertible loan.
GNR will be issued 150 million Pluton options, and has been granted the first right of refusal to purchase all iron ore produced by Pluton from its Cockatoo Island project, except for that which has already been committed to other parties from offtake agreements.
A condition of the funding agreement was that Pluton enters voluntary administration.
“Given the company’s current circumstances and the terms of the recapitalisation proposal received by the company, the board is unanimous in its decision that the appointment of voluntary administrators is the appropriate course of action at this time,” Pluton said.
“The receivers and managers and administrators will shortly commence engaging with the company’s key stakeholders to implement the recapitalisation proposal and financing, with a view to subsequently handing control back to the board to allow for recommencement of mining operations as soon as practical.”
Pluton flagged that it was in need of additional funds to meet ongoing debt repayments last month, when it said that it was in negotiations with its unsecured creditors in the hope of agreeing to a settlement for its outstanding debts.
Pluton first fell into receivership in late October last year, with GNR appointing KordaMentha as the company’s receivers.
The company’s board regained control in March.