Avesoro standstill extended; progress made in lender term sheet talks

By Caroline Salls

Pittsburgh, Dec. 15 – Avesoro Resources Inc.’s waiver and standstill agreement with Nedbank Ltd. and First Rand Bank Ltd. was extended to Jan. 30 to allow more time to complete due diligence on the offering of a guarantee, according to a news release.

Avesoro said it repaid $12.4 million of principal and $4 million of interest due on Dec. 14, reducing the company’s project finance debt outstanding to $97.6 million.

In addition, the company said substantial progress has been made in the negotiation of a term sheet with the lenders.

If Avesoro and the lenders agree on a term sheet, future debt repayments would be re-profiled, and some existing project finance covenants would be relaxed in exchange for a guarantee being provided.

If the negotiations do not result in an amendment to the terms of its project finance facilities, the company said it believes it will have sufficient cash resources to meet the existing debt repayment schedule, but it may be in breach of some covenants once covenant testing resumes.

Toronto-based Avesoro’s assets include the New Liberty Gold Mine in Liberia and a gold exploration permit in Cameroon.

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