Iron ore miner Territory Resources Ltd has today ruled out throwing any funding lifelines to embattled Monarch Gold Mining Company, and has also appointed a receiver in relation to outstanding loans.
Less than a week after former chairman Michael Kiernan clashed with the Territory board over a $3 million loan to Monarch, the iron ore miner today said there would be no further provision of funds to the gold miner either as debt or equity.
Territory also said it had some "concerns" over outstanding loans, and in particular had appointed a receiver in relation to the Minjar gold project, located 500km north of Perth. It said it was ensuring securities are in place until an acceptable loan repayment has been confirmed and completed.
Earlier this year Monarch sold the Minjar project to unlisted company Aard Metals and Energy Ltd for $11 million in a cash and equity arrangement, with Aard to take possession of the Minjar assets in June this year.
"The company has commenced discussions with Monarch Gold Mining Company Ltd to encourage the repayment of all outstanding loans," Territory said in a statement.
Monarch is teetering on the brink of administration following the recent closure of its loss-making Davyhurst gold mine near Kalgoorlie. The gold company is also deferring the $65 million purchase of the Mount Magnet gold project from Harmony Gold.
Territory has a 19.9 per cent interest in Monarch.
