Bowen Coking Coal is believed to be making efforts to raise $70m, say sources, after so far gaining commitments for investors to provide $30m at least.
It comes after the company on Wednesday lodged a request for an extension to its voluntary suspension, that was originally granted on September 18.
The company had asked that the extension remain in place until November 4 at the latest as it works on an equity financing event.
DataRoom understands Shaw and Partners is working on the raise for the loss-making company that has been trying to lower its operating costs and had been wall crossing investors for a deal about a week ago.
One of its most supportive shareholders, Regal Funds, has offloaded a stake of about 10 per cent in the business in the two weeks before the trading halt.
Regal owns half of secured creditor Taurus, which is owed $60m worth of loans by Bowen Coking Coal.
Also lending money to Bowen Coking Coal is New Hope Corporation.
Both lenders have agreed to extend the duration of the loans and for a material reduction in interest and royalty costs in return of equity and on the condition of a $25m equity raise and no insolvency event.
For the year to June, Bowen Coking coal lost $68.8m due largely to its under-performing Bluff Mine, with $54.6m of the loss already incurred by the half year.
While the group’s financial performance started to turn around in the second half of the year, after Bluff transitioned into care and maintenance, it was offset by steeply falling coal prices, and the hard coking coal premium low volatile price which decreased 27 per cent from $US324 a tonne at the end of December to $US234 a tonne at June, severely impacting profit margins.
Thermal coal prices fluctuated less over the same period – at $US87 a tonne in June compared to $US94 a tonne in December.
Bowen Coking Coal’s projects, all in Queensland, include the Burton Mine Complex, Hillalong, Isaac River, Cooroorah, Comet Ridge, Carborough and the Bluff Mine, and it also has joint venture projects.
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