20th Feb 2019 14:37
LONDON (Alliance News) - Russian gold miner Petropavlovsk PLC on Wednesday said that its investee IRC Ltd, to which it provided a USD30 million bridge loan, will not be able to repay the loan by the set deadline.
Petropavlovsk owns a 31.1% stake in IRC, a producer and developer of industrial commodities.
Petropavlovsk said it will not take any action to exercise its right to demand the repayment of the loan, provided that it is repaid by March 21, including all interests accrued and an additional USD100,000 fee.
"The independent directors of IRC consider that the terms of the waiver proposed by the lender are fair and reasonable and on normal commercial terms or better and it would be in the best interests of IRC and its shareholders as a whole to comply with the terms of the waiver," Petropavlovsk said in a statement.
The loan was signed by the two companies in June 2018 and was due for repayment on Wednesday.
Petropavlovsk loaned the USD30 million to IRC in order to help it meet a payment due under an Industrial and Commercial Bank of China project loan facility.
The loan was expected to be repaid as soon as the refinancing of the ICBC facility, of which Petropavlovsk is a guarantor, is completed.
Back in June, the miner said negotiations to refinance the facility were at an "advanced stage" with a "major" Russian bank.
The ICBC facility, granted to IRC's unit Kimkano-Sutarsky Mining & Beneficiation Plant LLC, amounts to USD340 million.
Petropavlovsk shares were trading up 1.6% at 8.215 pence each on Wednesday afternoon.
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