Johannesburg - Evraz Highveld Steel and Vanadium’s business rescue practitioners say they have finalised a process that will lead to the sale of its Mapochs mine.
In a statement issued to shareholders on Wednesday, the practitioners say the creditors’ committee had met and considered three offers in terms of the sales process.
Evraz Highveld, which is under business rescue, is currently the majority shareholder in the mine. When it filed for the process, Evraz explained it did not have sufficient funding to meet its financial obligations for the short-term.
“This is as a result of historical operational and financial difficulties and extremely difficult steel and vanadium market conditions.”
Business rescue allows companies to avoid having to liquidate and provides them protection from creditors. In this case, the process will afford Evraz a way to consider whether it should continue implementing a turnaround plan and successfully re-establish itself.
The business rescue practitioners, John Lightfoot (Matuson & Associates) and John Evans (RS Advisors), are set to announces the successful bidder this week, after initially indicating this would happen on Friday.
In addition, they says, the business rescue plan will be published by the middle of this month, after which creditors will vote on it.
Evraz had been sourcing magnetite iron ore from Mapochs, which is located near Roossenekal, 140 kilometres north east from Witbank (Emalahleni) before it and its subsidiaries went into business rescue.
Evraz, partly controlled by billionaire Roman Abramovich, bought a quarter of Highveld from Anglo American in 2006. It raised the stake to 85 percent the following year, paying more than $678 million for the transactions.
Moscow-based Evraz tried to sell the local unit business in 2013, but couldn’t fins a buyer after metals prices went into decline. Another subsequent deal, to form a partnership, was also unsuccessful .
IOL