Pluton recalls administrators

OREANDA-NEWS. Australian iron ore mining company Pluton Resources has been forced to appoint voluntary administrators for the second time in a year.

The company's major shareholder Hong Kong-listed mineral investment and trading firm General Nice called in administrators Pitcher Partners this week, after Pluton failed to secure funds from its proposed €50mn (\\$55.8mn) bond offering.

General Nice has offered to recapitalise Pluton subject to other lenders agreeing to its terms, which include the issue of 150mn share options in Pluton and first right of approval to all unallocated iron ore from Pluton's 1mn t/yr Cockatoo Island iron ore mine.

Pluton was only returned to control of its board in directors in March after spending more than four months in administration. It launched a ?25mn (\\$38.5mn) bond offering in May through its London-based subsidiary Irvine Iron Financing and then increased the scope of the offering in early June, citing an offer from a financial institution to buy the additional bonds. But the capital raising has failed to come off and General Nice has offered to lend Pluton HK\\$150mn (\\$19.4mn) as long as it returns to administration while the deal is negotiated.

Without the General Nice refinancing, Pluton's directors expect that they would be forced to liquidate the company.

The Cockatoo mine has been only operating sporadically since mining contractor Watpac walked out in November over unpaid debts. Watpac returned after Pluton emerged from administration and some iron ore was shipped mostly from tailings during July-August, but the contractor left again on 13 August when it was once again not paid by Pluton. It is a 5pc shareholder in Pluton and plans to discuss options for reopening the mine with the administrators.