Regency Mines warns of potential loan defaults
Exploration and development company Regency Mines has been in funding talks with major investors after shareholders gave the company the authority to issue news share at its annual general meeting in February.
However, shareholders chose not to give Regency permission to disapply pre-emption rights over any issuance that might occur, something the group said had "largely removed" its access to capital via a placing.
As a result, the AIM-listed group's board entered into discussions with various stakeholders concerning the ongoing requirements of the business, including both operational and financial obligations.
Regency warned that it may not be able to meet several of its loan repayments but said discussions were ongoing with multiple institutional investors regarding payments that may be due under the terms of its existing loan note.
Regency said: "The company's potential inability to meet these payments may require additional restructuring of its debt load and could result in the company forfeiting control of its interests in Mining Equity Trust and the US coal operations, as these assets have been pledged as collateral to the company's lenders."
As of 1045 GMT, Regency shares had tumbled 32.34% to 0.12p.