BRC Diamondcore $112m in red, hopeful of liquidation appeal

By: Martin Creamer 

JOHANNESBURG (miningweekly.com)  – Stricken

JSE- and TSX-listed BRC Diamondcore,

which reported a deficit of $112-million to June,

is hopeful of a positive appeal against

the liquidation of Diamond Core,

the holding company for all its South African assets.

The company said on Tuesday that

an application for leave to appeal

the liquidation order had been lodged with

the Northern Cape High Court,

based on suitor KIG Mining providing

cash to settle River Corporate Finance's claim.

KIG has agreed to buy the company's alluvial

South African assets for $10,7-million

in cash and shares.

Adviser River Corporate Finance brought

the liquidation to recover $1-million in fees,

with Diamondcore disputing the claim,

and countersuing for the return of R2-million.

BRC Diamondcore said that it intended

to petition the Supreme Court of Appeal

directly if the Northern Cape High Court

failed to grant leave to appeal.

Engaged in the acquisition, exploration

and development of diamond properties

in the Northern Cape and in

the Democratic Republic of Congo (DRC),

the company reported a working capital

deficit of $14,9-million and a

net $62 000 cash decrease in

the three months to June 30.

The company said that its management

was exploring all available options

to secure additional funding through

equity and debt financing, the sale

of selected business units,

the sale of noncore assets and

the establishing of strategic partnerships.

The services of all South African operational

employees had been terminated and only

a skeleton staff remained to attend

to administration and asset preservation.

Bulk sampling at Paardeberg East,

Silverstreams and De Kalk in South Africa and

at Tshikapa and the Northern Project in

the DRC, had been placed

on care-and-maintenance.

The company said that DRC gold

explorer Banro Corporation,

a significant BRC Diamondcore shareholder,

had guaranteed a $6-million loan facility

to the company and would like

to be extricated from

that guarantee as soon as possible.

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             J-L K.
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