Updated article published earlier this morning (20 November) with the latest information.
True North Copper (ASX:TNC) creditors have voted in favour of an equity recapitalisation plan. However, True North today announces it is not able to use the ‘low doc’ regime or rely on cleansing notices to raise capital as its shares have now been suspended from quotation for more than five trading days during the last 12 months.
Administrators KordaMentha yesterday (19 November) announced a deed of company arrangement (DOCA) to recapitalise True North Copper and associated entities, which was unanimously accepted by creditors at the second creditors’ meeting on 18 November 2024.
Proposed by Canaccord Genuity (Australia) and Morgans Corporate, the DOCA involves recapitalising True North via an equity raising of $50 million to $60 million (before costs).
The equity raise needed to be approved by True North shareholders at the annual general meeting (AGM) on or around Friday 20 December 2024.
following reports by Mining.com.au on 24 October that administrators were undertaking a dual-track recapitalisation and sales process following the company being placed in administration, it was reported KordaMentha intended to rely on relief set out by ASIC’s ‘lo doc’ regime to defer financial reporting obligations and its AGM.
True North today reports that the Act allows continuously disclosing entities to use transaction specific prospectuses, which include specified limited content because the issuers are subject to the continuous disclosure regime such that the market will generally already have the information available to it to make an informed assessment of an offer of continuously quoted securities.
However, absent relief from ASIC, True North says it is not able to use a transaction specific prospectus because of its reliance on the financial reporting relief.
The company says it has complied with all of its obligations under the Act in relation to the reporting period ended 30 June 2024 “but for the requirement under section 317 to lay the various financial reports before the annual general meeting”.
Accordingly, ASIC has granted relief to allow the company to use a transaction specific prospectus in relation to an offer to issue securities pursuant to a prospectus where the offer closes before 31 January 2025.
“The relief has the effect of allowing True North to use a transaction specific prospectus in connection with the proposed recapitalisation, notwithstanding the intended reliance on the financial reporting relief,” as per its ASX announcement.
As reported earlier today by this news service, once the recapitalisation plan was to gain approval, True North Copper would then emerge from administration and its shares recommence trading on the ASX.
Deed administrator Richard Tucker says strong support from creditors for the recapitalisation plan is a testament to the quality and potential of True North Copper’s assets – the ‘mine ready’ copper-gold Cloncurry project and the high-grade copper-silver-cobalt Mt Oxide project.
Write to Adam Orlando at Mining.com.au
Images: True North Copper
