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Mineral processing technologies provider Alexander Mining (LSE:AXM) revealed today it proposes a capital restructuring for approval by its shareholders, triggering a drop of the company’s shares on the London Stock Exchange today.
Acutely Challenging
In a statement issued earlier today, Alexander Mining said the company “in common with a multitude of other companies in the mining sector, has been affected by the acutely challenging economic and market conditions.”
Shares of the rights owner of the AmmLeach® mineral processing technology have been trading below their nominal value of 10 pence since May 2011, preventing the company from a possible issuance of new ordinary shares for equity financing.
Last Friday, the price of Alexander mining stocks were 4.38p a share. The last time it was above 10p was on 4th May 2011. Since then, stock prices have been going down.
The company posted a loss of £193,000 for the year ending 31st December 2011, affected by the sovereign debt crisis in the second half of 2011 which drove down prices of base metals, according to Chairman Matt Sutcliffe.
Restructuring
As detailed in the capital restructuring proposal, Alexander Mining proposes to break the issued shares into one new ordinary share of 0.10 pence each and one deferred share of 0.99 pence each, such that the number of existing shares remain unchained.
“The Deferred Shares will not be admitted to trading on AIM, will have only very limited rights on a return of capital and will be effectively valueless and non-transferable,” the company said.
The Board of Alexander Mining recommends that the shareholders vote in favour of the proposition, warning them that failure to obtain the requisite support of the shareholders will“prohibit the Directors from issuing shares at less than 10 pence per share.”
“The Board considers that the proposals described are in the best interests of the Company and of the shareholders as a whole,” the statement concluded.
The shareholders will have to decide on 14th June 2012, the same day the company will hold its Annual General Meeting in London.
Company Spotlight
Alexander Mining is a UK-incorporated parent company of MetaLeach Limited, engaged in the commercialisation of its proprietary hydrometallurgical mineral processing technologies, including AmmLeach®, an environmental friendly process for extracting base metals from ore.
Shares of Alexander Mining are listed on both the Alternative Investment Market and the TSX Venture Exchange. At the end of trading, Monday, the company’s stocked slipped a further 14.3% to 3.75 pence a share.
References
↑ Alexander Mining 2011 Annual Report
↑ About MetaLeach Limited
