4th May 2016 07:38
LONDON (Alliance News) - New World Resources PLC confirmed it is on the brink of collapse on Wednesday after its shares were suspended from trading on the London Stock Exchange after its subsidiary filed for insolvency.
ODK holds all of New World's assets and the OKD board members met last week to discuss filing for insolvency after failing to strike a deal over debt and the future of the company with the government of Czech Republic, where it operates. That application was filed on Tuesday.
The Warsaw and Prague Stock Exchanges are also processing requests to suspend New World shares from trading.
If OKD is made insolvent, then New World would be "wound up or broken up in an orderly manner".
"If this occurs, it is expected that there will be very minimal or no returns to the shareholders of New World Resources PLC, apart from the potential distribution of any cash balances of New World Resources PLC that may remain after the orderly wind up or break up of the New World resources Group," said the company.
New World was hit by the wider rout within commodity markets that started in the middle of 2014, but looked unlikely to resolve its "very weak" financial position after conceding it would incur heavy losses between 2015 and 2018.
By Joshua Warner; [email protected]; @JoshAlliance
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