Former Bushveld subsidiary defaults on loan repayment
By Josh White
Date: Friday 29 Nov 2024
(Sharecast News) - Bushveld Minerals announced on Friday that Vanchem, a subsidiary it recently sold, has failed to repay ZAR 14.4m (£0.63m) plus accrued interest, which was due 21 November.
The AIM-traded company said the payment was part of a shareholder loan owed to Bushveld Vanadium 2 (BV2), a group company and former shareholder of Vanchem.
It said the outstanding payment, which carries a 15% annual interest rate, was part of a broader loan balance due in December.
The repayment amount had already accounted for an offset of ZAR 35m related to kiln repairs and production losses incurred prior to the Vanchem sale.
However, Bushveld said it disputed the ZAR 35m estimate, and had agreed with the buyer, Southern Point Resources Fund I, to appoint an independent expert to verify the actual damages.
The final adjustment to the deferred consideration would depend on that assessment.
Bushveld said the funds, once recovered, were earmarked for partial repayment of an intercompany loan owed by BV2 to Bushveld Vametco Alloys.
Meanwhile, Bushveld said it had appointed business rescue practitioners for several South African subsidiaries, including Bushveld Vametco Alloys, Bushveld Vametco Holdings, and Bushveld Minerals SA.
The practitioners were engaging with Vanchem and exploring legal avenues to recover the overdue amount.
Reporting by Josh White for Sharecast.com.
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