LONDON (Alliance News) - Continental Coal Ltd Tuesday said it will cancel its AIM listing on Wednesday, after it failed to complete the sale of its Continental Coal Ltd SA subsidiary and subsequent refinancing in time to save the listing.
Continental Coal's shares have been suspended from trading on AIM for over six months, and the company said that since it can't restore trading in the immediate short-term, its admission to AIM will be cancelled from 0700 BST on Wednesday.
On October 10, the company said it had received offers from third parties looking to buy its 74% stake in its South African subsidiary. That followed its announcement September 30, when it said only 10% of its fully underwritten AUD35.2 million rights issue was taken up, although the remainder was placed with underwriter Patersons Securities Ltd. It has now halted the right issue process.
It had said the proceeds from the offer would be used to repay its unsecured convertible noteholders, loans and royalty holders, to repay its bridging finance, to reduce the groups other borrowings, to provide funds towards the development of its advanced coal mining projects and to provide working capital
In its statement on Tuesday, the company reiterated that it is finalising legal advice with regards to a scenario whereby an accepted offer for its subsidiary is announced and shareholders are then offered the opportunity to have their funds returned from the rights issue, or to remain in a new raising.
"As a consequence of this development, Continental has deferred finalising the completion of any refinancing of the company through the current rights issue process," it added.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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