GREY:COLUF - Post by User
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Ben.sotechnicalon Jan 15, 2014 1:45pm
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FP says Colossus Minerals seeks creditor protection
FP says Colossus Minerals seeks creditor protection
FP says Colossus Minerals seeks creditor protection
2014-01-15 09:16 ET - In the News
Also In the News (C-SSL) Sandstorm Gold Ltd (2)
The Financial Post reports in its Wednesday, Jan. 15, edition that Colossus Minerals (four cents), a former star of the junior mining sector, said on Tuesday it will seek creditor protection after it failed to make a small interest payment due at the end of 2013. The Post's Peter Koven writes in the National Report column that the insolvent company plans to file a so-called "notice of intention" that would allow it to pursue a sale process and restructuring under court supervision. Meantime, Colossus expects to receive short-term financing from noteholders and from streaming company Sandstorm Gold ($4.76) to stay afloat during the next six weeks. That will buy Colossus time to either sell itself or convert its debt into equity, giving noteholders control of the company. If Colossus ends up having a debt-for-equity swap, noteholders would own 51.5 per cent of the stock, Sandstorm would own 38.8 per cent, lenders under a bridge loan would own 8 per cent and current shareholders would own just 1.7 per cent. Mr. Koven says it is a disappointing outcome for a miner that had very bright prospects