new name for croesus

From The West Australian

New name, structure for Croesus

JOHN PHACEAS

Embattled WA gold miner Croesus Mining will be rebadged Norseman Gold Mining Company in a bid to bounce back from its brush with financial oblivion and cash in on booming gold prices.

Croesus registered the name earlier this month in a move to both sever its emotional ties to the business founded by Kalgoorlie veteran Ron Manners 20 years ago and revive memories of Central Norseman Gold Mines, the 70-year-old company Croesus acquired from WMC in 2002.

However, the timing of Croesus' resurrection still hinges on a formal agreement to restructure the onerous hedging commitments which sent it to the brink of collapse in mid-March after the miner was struck by major production shortfalls and cost blowouts at its Norseman mines.

Hedging partners Macquarie Bank and Japan's Mitsui Precious Metals last month gave in-principle agreement to a major restructure of the hedgebook, which was $50 million in the red at the end of March.

Croesus chairman Michael Kiernan yesterday said the parties had still not signed off on the restructure but were "99.9 per cent there".

Under the proposed restructure, Macquarie would give Croesus an extra two years to deliver 160,000 ounces now contracted and allow the miner to sell half of its current production into the booming spot market.

Mr Kiernan said Mitsui had also closed out its 40,000oz exposure to Croesus, leaving the miner owing $11 million to the Japanese metals trader. Croesus had asked for a six-month standstill on repayments to Mitsui, which may also convert some of the debt to equity, he said. Croesus had also asked Macquarie for a six-month standstill on its hedging commitments.

Once those agreements had been finalised, Croesus would be ready to start rebuilding.

Mr Kiernan said the name change would be a central part of the rebuilding program, along with at least two capital raisings and a London listing.

"The bottom line is we'll be looking to raise $10 million in the short-term and $15-20 million in the long term," Mr Kiernan said. "For the short term (money), I'll probably look within Australia, and the longer term will most likely be (raised) in London."