The Mission Group Regulatory News (TMG)

29 Mar 2007 07:30

Thistle Mining Inc.29 March 2007 THISTLE MINING INC. Suspension of Trading Thistle Mining Inc ("Thistle) (AIM: TMG) wishes to announce that on March 27,2007 it has received written notices from its two major shareholders andcreditors, MC Resources Limited ("MC") and Casten Holdings Limited ("Casten")indicating that they are not willing to defer payments of principal and interestdue on April 1, 2007. The amount payable on this date, assuming a CAD$:US$ exchange rate of 1.1578, isUS $24.74 million comprising of US $12.371million and US $12.369 million owingto MC and Casten respectively. Pursuant to the terms of the credit agreementsand loan notes, failure of Thistle to pay the April 1 payment in full willconstitute an event of default. Upon the occurrence of an event of default, MCand Casten are entitled under the credit agreements and related loan notes toimmediately accelerate and demand payment of all indebtedness and to enforce thesecurity that Thistle has granted to MC and Casten, including, withoutlimitation, the pledge of shares of Thistle's subsidiaries, including TowoongMining BV which holds the shares of CGA Mining Limited ("CGA"). The CGA shareswere acquired by Thistle in a transaction that completed earlier this month,which is described in greater detail below. The total amount of indebtednessowing to MC and Casten is estimated to be US $51.99million. In additionwithholding taxes on interest to be paid is estimated at US $2.203 million. Forclarity, the indebtedness owing to MC and Casten on April 1, 2007 is summarizedbelow. Indebtedness due to MC and Casten ($ millions) Indebtedness before application of CGA proceeds 51.44 Payment of CGA proceeds on March 20, 2007 26.70 Debt due and payable and interest payable on April 1, 2007 24.74 Debt due after April 1, 2007 27.25 Total debt and interest owing to Casten & Meridian 51.99 Thistle does not have the cash resources or access to cash resources to meet theamount payable to MC and Casten on April 1, 2007 and in the absence of arestructuring agreement with MC and Casten will be in default of the creditagreements and related loan notes. Each of Casten and Thistle has stated thatit reserved the right to demand payment in full under the credit arrangementsand loan notes, including the right to realise on its security. Each of MC and Casten currently holds 35% of the issued shares of Thistle. At a meeting of the independent directors convened on March 28, 2007specifically to discuss this matter, the independent directors of Thistleunanimously determined that Thistle is in serious financial difficulty and thatit is in the interests of shareholders that management use best endeavours toreach agreement on the restructuring of debt on acceptable terms. Managementare cautiously optimistic that this can be achieved. Thistle's independentdirectors have requested that Thistle's shares be suspended from trading on theAIM market of the London Stock Exchange plc pending satisfactory resolution ofthis matter. The CGA Transaction. All the conditions related to the sale of 100% of theshares of Philippine Gold Ltd, a wholly-owned subsidiary of Thistle, andThistle's other interests in the Masbate gold project to CGA (ASX: CGX) (the "Transaction") subject to the terms and conditions set out in the originalagreement dated January 31, 2007 and as amended on March 15, 2007 ("SPA") havebeen satisfied and the transaction has been completed. Pursuant to the SPA, the consideration that was paid amounted to in aggregateUS$51 million of which US$21 million was payable in ordinary shares of CGA (the"CGA Shares"). Applying the pricing formula Thistle received 40,985,538 CGAShares on Tuesday March 19, 2007. This represents an approximate 25.4% interestin CGA. In addition on March 19, 2007 Thistle received US $28,887,430. Thispayment enabled Thistle to pay down US$26.70 million of the debt owing to MC andCasten on March 20, 2007 in accordance with terms of credit agreements in placewith Casten and MC. This news release contains forward-looking statements with the meaning ofapplicable securities laws including amongst others, statements made or impliedabove relating to the Company's objectives, strategies to achieve theseobjectives, future cash flow and financing requirements, and similar statementsconcerning anticipated future events, results, circumstances, performance orexpectations that are not historical facts. Such forward-looking statementsreflect the Company's current beliefs and are based on information currentlyavailable to management. These statements are not guarantees of futureperformance and are based on the Company's estimates and assumptions that aresubject to risk and uncertainties inherent in the business of the Companyincluding those discussed in the Company's materials filed with the Canadiansecurities regulatory authorities from time to time, which could cause theactual results and performance of the Company to differ materially from theforward-looking statements contained in this news release. Although theforward-looking statements contained in this news release are based upon whatthe Company believes are reasonable assumptions, there can be no assurance thatactual results will be consistent with these forward-looking statements. Allforward-looking statements in this news release are qualified by thesecautionary statements. These forward-looking statements are made as of the datehereof and the Company, except as required by applicable law, assumes noobligation to update or revise them to reflect new information or the occurrenceof future events or circumstances. For further information, contact: Andy Graetz, Chief Financial Officer at + 27 82 929 5562 or email toagraetz@disselgroup.com Gerry Beaney, Maureen Tai or Troy MacDonald, Grant Thornton Corporate Finance at+44 (0) 207 383 5100 This information is provided by RNS The company news service from the London Stock Exchange