International Mining receives support to restructure 8¾%, 8 7/8% debt

New York, April 28 – International Mining & Infrastructure Corp. plc said that a planned restructuring of its $30 million of 8¾% bonds due 2016 and the $20 million of 8 7/8% bonds due 2016 issued by Afferro Mining Inc. has been accepted by the holders and will be implemented immediately.

The company now has votes in favor of the changes from holders of more than 75% of each series of the bonds.

Because the required threshold has been passed in each case, the company has brought forward the closing date to April 27, and the changes will be implemented immediately.

The deadline for delivering consents was originally 5 a.m. ET on May 5.

“We are delighted with the positive decision from the [2016 and Afferro] bondholders who voted unanimously in favor of the proposed amendments,” said Ethelbert Cooper, the company’s chairman, in a news release.

“As the votes have now been obtained, completion of the restructuring process is expected to become effective immediately. The restructuring of the bond will make the company’s debt commitments manageable and contribute to rebalancing of the group’s financing obligations.”

Under the terms of the restructuring, the maturity of both bonds will be extended by five years to Oct. 30, 2021 from Oct. 30, 2016.

The coupon on both bonds will be reduced to 5%, 375 basis points below the current level for International Mining and 387.5 bps lower for Afferro.

To compensate for the reduction in interest, the payment at maturity will be increased to 132.059% of par for the International Mining bond and 133.1278% of par for the Afferro bond.

Interest will be paid annually instead of semiannually.

As part of the changes, International Mining will add an accelerated repayment covenant requiring the company to immediately repay the bonds if Ethelbert Cooper is removed from the office of director and non-executive chairman by a shareholder resolution.

International Mining previously said that it had held discussions with some holders of the bonds on terms of the restructuring and it expects them to support the amendments.

The company said that it believes the changes are “prudent” because of the “considerable fall in international iron ore prices over the past 15 months,” which has created a “challenging environment.”

International Mining’s operations are unlikely to generate cash in the near term, the company added.

International Mining is a London-based company focused on unlocking the value of iron ore in Africa through infrastructure development and investments in junior miners. Afferro is a 100% owned Canadian subsidiary of International Mining.

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