Heron Resources has commenced a strategic process in relation to its Woodlawn zinc-copper project in New South Wales, Australia. Azure Capital will, in conjunction with the company’s board and a Strategic Process committee, explore various options for Woodlawn including refinancing, joint ventures, and partial or complete divestment.
Operations were suspended at Woodlawn in late March due to travel and other restrictions imposed by the Australian government in response to the COVID 19 pandemic. Woodlawn will remain on Care and Maintenance until the strategic process terminates or as otherwise agreed between Heron and its stakeholders.
In support of the strategic process, Heron has received a further 12-month extension of its senior facilities waivers until 13 August 2021, subject to certain conditions including the company continuing the strategic process and implementing the recommendations of the Strategic Process committee. Heron has also agreed parallel forbearance with its major unsecured creditors.
Heron Chief Executive Tim Dobson said: “It has been a challenging time for Heron since taking the difficult, but right decision to suspend operations at Woodlawn in March this year, and we acknowledge the patience and support of our creditors during this period. It is pleasing that Heron’s key stakeholders have agreed to provide a clear runway and financial support to execute the strategic process over the next 12 months.”
Heron believes there is significant inherent value in Woodlawn and the primary objective of the strategic process will be to maximise value for all stakeholders.
The company also announced that in support of the process, it received a A$3.5 million care and maintenance loan from Castlelake L.P., which will be funded in a single tranche. Repayment will be from any proceeds from the strategic process.