LONDON (Alliance News) - International Ferro Metals Ltd Tuesday said a meeting has been held between its troubled South African subsidiary, its business rescue practitioner and the company's creditors to discuss the best steps forward to save the subsidiary.
The company said the practitioner has agreed with creditors to delay the release of its Business Rescue Plan for the subsidiary, and said it believes it can accelerate the sale of partial sale of the company by chasing interested parties.
Back in August, International Ferro Metals said it was taking steps to address its "financially distressed" South African subsidiary to protect it from its creditors. The subsidiary, International Ferro Metals (SA) (Pty) Ltd, entered into a Business Rescue due to its "deteriorating business conditions" that were out of the company's control.
A Business Rescue is a statutory means of enabling a financially distressed company to continue in
business, under the supervision of a Business Rescue Practitioner, protected from its creditors. It means creditors who are trying to reclaim funds for whatever reason can not do so without going through the practitioner, who will try to implement a plan to resolve the financial issues at the company.
On Tuesday, the company said a meeting had been held between the subsidiary, the business rescue practitioner and the subsidiary's creditors.
The practitioner has said there is a "reasonable prospect" of rescuing the subsidiary, most likely through the sale of assets, the entire business or equity in the business. There are "a number" of interested parties in entering some form of deal with the subsidiary, but details of the potential bidders and possible offers were not disclosed, the company said.
The practitioner believes opening a bid process would take two to three months to complete but said this can be accelerated by pursuing those parties who have already shown interest.
Creditors have therefore agreed for the release of the Business Rescue Plan to be pushed back to the end of November in order to allow sufficient time for the bid process to be finalised.
Whilst the Business Rescue is being conducted, the subsidiary has shut down all of its furnaces and mining operations and International Ferro Metals had already requested its shares be suspended in the meantime.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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