Restructuring the shaft of shame: Rubicon Minerals aims to start anew in 2017 – by Staff (Northern Ontario Business – December 20, 2016)

An Ontario court has approved a restructuring plan to revive a shuttered gold mine development in northwestern Ontario.

Rubicon Minerals was granted a sanction order from the Ontario Superior Court of Justice, Dec. 8, to approve the Toronto-based mine developer’s refinancing and restructuring plan for its Phoenix Gold project near Red Lake. The company sought protection from its creditors on Oct. 20. Ernst & Young was appointed as the monitor.

A majority of the affected creditors had earlier voted to approve the plan on Dec. 2. Rubicon announced Dec. 20 that the restructuring process was complete and that the company has been notified by the TSX that its common shares will remain listed on the TSX under the symbol RMX. Rubicon shares will resume trading on Dec. 22.

In November, Rubicon closed a $45 million financing deal, which is earmarked to pay down part of the debt owed to CPPIB Credit Investments, the top-ranked secured creditor; to pay for an exploration program at the Phoenix Gold Project, and for general working purposes.

Rubicon Minerals’ Phoenix Gold project is one of the Northern Ontario’s most embarrassing mine development blunders.

The previous Rubicon management decided to forego a feasibility study, jumping from a preliminary economic assessment straight to construction of all the surface buildings and infrastructure, and underground development, raising hundreds of millions from investors in the process.

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