African Minerals halts trading, shuts down Sierra Leone assets
Iron ore miner African Minerals’ (LON:AMI) shares were suspended from trading Monday morning as the company placed its flagship Tonkolli project in Sierra Leone, its main business focus, on care and maintenance because it does not have enough working capital.
The combination of a lack of investment and slumping iron ore prices forced the miner to halt its operations, the miner said in a statement. It added it was unable to introduce cost reduction initiatives to keep the project going.
At the same time, the company has been dealing with the effects of the Ebola epidemic in West Africa.
The company said the project would remain suspended until it either releases $102 million in restricted cash or can secure other short term funding, with its shares remaining suspended until the "fundamental uncertainty in the financial position of the company" is sorted.
African Minerals is seeking to sell part of its stake in the Tonkolili mine in Sierra Leone to raise funds.
It warned that while it was in talks with several “potential groups" that have expressed an interest in acquiring a stake, there is no certainly of any imminent deal.