REG - Metals Exploration - Update on Debt Discussions

Metals ExplorationAnnouncement

09/05/2024 07:00

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RNS Number : 7052N  Metals Exploration PLC  09 May 2024

9 May 2024

 

 

METALS EXPLORATION PLC

 

UPDATE ON DEBT DISCUSSIONS

 

Metals Exploration plc (AIM: MTL) ("Metals Exploration", the "Company" or the
"Group"), a gold producer in the Philippines, provides a further update on
discussions with its lenders in respect of the repayment of the Group's
mezzanine debt facilities.

 

Further to the Company's announcement on 27 March 2024, Runruno Holdings
Limited ("RHL") and D & A Holdings Limited ("D&A") (together, the "RHL
Group") have written to the Company disputing the Company's position that a 7%
(as opposed to 15%) interest rate should apply under the Company's mezzanine
facilities since 3 November 2022 (the date at which the Group's senior debt
was substantively repaid) and, accordingly, disputing that the Company has
settled all outstanding amounts due under such mezzanine facilities.

 

In addition, the RHL Group has claimed that several events of default have
occurred under the Group's senior and mezzanine facilities, such that the
relevant default interest rate (being a total of 12% under the senior debt
facility and 20% under the mezzanine debt facilities) should apply with effect
from 5 October 2023, which it claims would result in approximately US$1.95
million being owed to the RHL Group pursuant to the mezzanine facilities as at
31 March 2024.  The Company disputes these allegations.

 

In light of the RHL Group's position in respect of the application of 15%
interest to its loans under the mezzanine facilities, MTL (Luxembourg) S.à
r.l. (Nick Candy's investment vehicle, holding 70.7% of the mezzanine debt)
("MTL Lux") is also seeking to receive this interest rate on its own loans to
the Company.  This would result in approximately US$4.4 million being owed to
MTL Lux pursuant to the mezzanine facilities as at 31 March 2024.

 

This is contrary to historical assurances given by MTL Lux, including as
announced on 24 January 2024 and 27 March 2024, that it agreed that the 7%
interest rate would apply to its loans under the mezzanine facilities, with
effect from November 2022.  However, these assurances were given either on an
informal basis or for a limited period only.

 

Having considered legal advice on the matter, and while discussions continue,
the Company will make pro-rated settlement payments to the lenders of:

 

-       US$2.2 million to MTL Lux; and

-       US$0.91 million to the RHL Group,

being approximately 50% of the amount that would be due to MTL Lux and the RHL
Group (respectively) under the Company's mezzanine facilities were the rate of
15% (as opposed to 7%) to be applied up to 31 March 2024.

 

In addition, MTL Lux has formally confirmed that it does not agree that any
default interest is payable under the senior or mezzanine facilities.

 

Further announcements will be made in due course, as discussions with MTL Lux
and the RHL Group to seek a settlement of these matters continue.

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014, which forms part of United Kingdom domestic law by
virtue of the European Union (Withdrawal) Act 2018 (as amended). Upon the
publication of this announcement, this inside information is now considered to
be in the public domain.

 

-       END    -

 

 

For further information please visit or contact:

 

 Metals Exploration PLC
 Via Tavistock Communications Limited     +44 (0) 207 920 3150
 Nominated & Financial Adviser:           STRAND HANSON LIMITED
 James Spinney, James Dance, Rob Patrick  +44 (0) 207 409 3494
 Financial Adviser & Broker:              HANNAM & PARTNERS
 Matt Hasson, Franck Nganou               +44 (0) 207 907 8500
 Public Relations:                        TAVISTOCK
 Jos Simson, Nick Elwes                   +44 (0) 207 920 3150

 

 

Web:                      www.metalsexploration.com
(http://www.metalsexploration.com)

Twitter:                  @MTLexploration
(https://twitter.com/MTLexploration)

LinkedIn:               Metals Exploration
(https://www.linkedin.com/company/metals-exploration-plc)

 

 

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