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DiamondCorp Battles to Save Lace Mine

Nov 30, 2016 10:21 AM   By Rapaport News
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RAPAPORT...
 A business rescue practitioner has begun talks with stakeholders in the Lace Diamond Mine (LDM) as parent company DiamondCorp continues to assess the financial viability of the troubled South African operation.

Daniel Terblanche, the appointed rescuer from consultancy firm Deloitte, has started discussions with creditors, bondholders, workers and trade unions, among others. DiamondCorp's board is also in continuing deliberations with LDM’s creditors, while auditor PricewaterhouseCoopers (PwC) is working with management to assess the company’s position, the mining company said.

“Management, alongside PwC, continues to evaluate the group's financial projections to determine the resultant additional capital required in the event of a successful conclusion of rescue proceedings,” DiamondCorp said.

LDM entered business rescue earlier this month after torrential rain left the South African mine flooded, resulting in a suspension of operations of more than 12 weeks while water is pumped out and repairs undertaken. The 310-meter “production level” is now clear of flood water and the mine’s pumping system is back to normal, but the drill rig’s access ramp still awaits repair, DiamondCorp said. LDM is in the process of filing an insurance claim for the storm damage and repairs.

The miner said 5,130 carats of diamonds that were recovered before the mine closure are being tendered for sale in Johannesburg.

Earlier this year, operations at the Lace mine were halted because of a government investigation into an incident involving explosives that injured a worker. Last November, drilling was delayed because of difficult ground conditions.

DiamondCorp’s shares remain suspended on the London Stock Exchange’s Alternative Investment Market and the Johannesburg Stock Exchange’s AltX bourse at the company’s behest.
Tags: Daniel Terblanche, deloitte, DiamondCorp, Industrial Development Corporation of South Africa, Johannesburg, Lace Diamond Mines, Lace Mine, LDM, mines, mining, PricewaterhouseCoopers, pwc, Rapaport News, South Africa
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