Horizonte extends waivers on interest payments to late March

1st Mar 2024 11:34

(Sharecast News) - Horizonte Minerals announced on Friday that it has extended waivers on interest payments, providing relief amidst ongoing financial negotiations.

The AIM-traded firm said the waivers, originally due at the end of February, had now been extended until 29 March as part of an interim funding package agreed with senior lenders.

It said it remained committed to securing a comprehensive funding solution by the end of the second quarter, collaborating closely with major shareholders and senior lenders.

Despite efforts to control costs, additional interim funding could be necessary to implement the full funding solution.

As of 27 February, Horizonte held a cash balance of $24.8m, excluding funds earmarked for the Vermelho Project, expected to sustain working capital until mid-April.

However, that timeline was contingent on ongoing discussions with creditors, project expenditure, and potential working capital measures.

Acknowledging uncertainties, the company said the the outcome for existing shareholders and noteholders was not guaranteed, nor was the continued extension of waivers by senior lenders until a full funding solution was achieved.

In the interim, Horizonte Minerals' Brazilian subsidiary, Araguaia Níquel Metais (ANML), which holds senior loan facilities, could employ protective measures to facilitate negotiations and restructuring of indebtedness.

Such measures would afford ANML ample time for balanced and transparent negotiations with creditors while safeguarding short-term cash reserves.

"The company considers that an application for protective measures by ANML would not directly impact Horizonte Minerals' current financial condition," the board said in its statement.

"However, as a guarantor of ANML's debt under the senior loan facilities, if claims are made in relation to the guarantee, the company may also need to consider applying for protective measures that may be available to it, in the event that a refinancing and restructuring solution for the group is not achieved or if no agreement is reached with senior lenders with respect to further extensions of the abovementioned waivers."

At 1303 GMT, shares in Horizonte Minerals were down 14.08% at 3.22p.

Reporting by Josh White for Sharecast.com.