Paladin creditors agree to proposed restructuring

11 December 2017

Paladin Energy's creditors have agreed to a proposal to restructure the company's debt and reinstate it to quotation on the ASX. The Western Australia-based company's creditors have executed the proposed deed of company arrangement (DOCA). Major creditor Electricité de France (EDF) previously said it may seek to have the DOCA, which it claims is unfairly prejudicial towards it, terminated.

Paladin, owner of the Langer Heinrich uranium mine in Namibia, appointed administrators in July after failing to agree a delay to the repayment of a $277 million debt to EDF. The company has been undergoing a balance sheet restructuring since February and is administered by Matthew Woods, Hayden White and Gayle Dickerson of KPMG.

The administrators said on 1 December that they had been seeking possible recapitalisation and restructuring alternatives for the companies - Paladin Energy Ltd, Paladin Finance Pty Ltd and Paladin Energy Minerals NL - and had received only one proposal, from a group of Paladin's unsecured bondholders known as the Ad Hoc Committee. In their annual report to shareholders, issued on 30 November, the administrators advised creditors to accept the proposed DOCA put forward by the Ad Hoc Committee as being in the creditors' interests.

The key terms of the proposed DOCA include a debt for equity swap, which would see 98% of Paladin's issued shares transferred to creditors (with existing shareholders retaining 2%); the raising of $115 million pursuant to the issue of a high-yield secured note; and the reinstatement of Paladin to official quotation on the ASX.

The administrators on 7 December said EDF had rejected their conclusion that the proposed DOCA was in creditors' interests. "EDF has also claimed that the proposed DOCA is unfairly prejudicial to it and has foreshadowed that it may seek to have the DOCA terminated if creditors resolve that the DOCA be executed," they noted.

On 8 December, Matthew Woods of KPMG announced that the creditors of each of the companies had agreed to the proposed DOCA and the administrators and the respective companies had accordingly executed the deeds. The administrators have estimated that the recapitalisation will be completed before 31 January 2018.

Researched and written
by World Nuclear News

Filed under: Mining, Namibia