Banro doubts abil­ity to con­tinue as go­ing con­cern

Stockwatch Daily - - FRONT PAGE - An anony­mous di­rec­tor re­ports

BANRO CORP. con­tin­ues to face sig­nif­i­cant, con­tin­u­ing, op­er­a­tional and fi­nan­cial chal­lenges in­clud­ing short- and long-term liq­uid­ity con­straints. The com­pany’s abil­ity to con­tinue op­er­a­tions in the nor­mal course of busi­ness is de­pen­dent on sev­eral fac­tors, in­clud­ing se­cur­ing fi­nanc­ing for op­er­a­tions and to meet up­com­ing debt ser­vic­ing and work­ing cap­i­tal re­quire­ments. In ad­di­tion, min­ing op­er­a­tions at the com­pany’s Namoya mine in Maniema prov­ince of the Demo­cratic Repub­lic of the Congo (DRC) con­tinue to be sus­pended due to the con­tin­u­ing clo­sure of road ac­cess to the mine site. Please re­fer to the com­pany’s press re­lease of Sept. 25, 2017.

In the event the com­pany is un­suc­cess­ful in ad­dress­ing these con­tin­u­ing op­er­a­tional and fi­nan­cial chal­lenges, it may be­come un­able to meet its non-DRC fi­nan­cial obli­ga­tions as they be­come due.

As pre­vi­ously an­nounced, the board of di­rec­tors of the com­pany es­tab­lished a special com­mit­tee com­pris­ing in­de­pen­dent di­rec­tors to iden­tify and make rec­om­men­da­tions to the board con­cern­ing fi­nanc­ing and other strate­gic op­tions (in­clud­ing the re­struc­tur­ing or re­fi­nanc­ing of ex­ist­ing obli­ga­tions).

The com­mit­tee has ad­vised the board that, based in part on the opin­ion of its fi­nan­cial ad­viser, it has con­cluded that there is no rea­son­able prospect that a suc­cess­ful cap­i­tal raise (whether debt, eq­uity or a com­bi­na­tion) could be com­pleted at the cur­rent time at a level suf­fi­cient to re­fi­nance the com­pany’s ex­ist­ing in­debt­ed­ness and to ad­dress its work­ing cap­i­tal re­quire­ments. Con­se­quently, there is sub­stan­tial doubt as to the com­pany’s abil­ity to con­tinue as a go­ing con­cern.

The com­mit­tee re­ported that it is in dis­cus­sions with the com­pany’s ma­jor stake­hold­ers con­cern­ing the pos­si­ble re­struc­tur­ing of the com­pany’s non-DRC debt obli­ga­tions as well as the pro­vi­sion of fi­nanc­ing to sup­port the com­pany’s con­tin­u­ing op­er­a­tions in the DRC. There is sig­nif­i­cant risk that any re­struc­tur­ing of the com­pany’s non-DRC debt obli­ga­tions may re­sult in sig­nif­i­cant im­pair­ment to the value of the eq­uity hold­ers’ in­ter­ests in the com­pany.

The com­pany con­tin­ues to take all steps nec­es­sary to en­sure the con­ti­nu­ity of its op­er­a­tions in the DRC.

Due to the sig­nif­i­cant un­cer­tainty sur­round­ing the com­pany’s abil­ity to con­tinue as a go­ing con­cern, the com­pany will not be in a po­si­tion to re­lease its in­terim unau­dited con­densed con­sol­i­dated fi­nan­cial state­ments and re­lated man­age­ment’s dis­cus­sion and anal­y­sis for the pe­riod ended Sept. 30, 2017.

About Banro Corp. Banro is a Cana­dian gold min­ing com­pany fo­cused on pro­duc­tion from the Twan­giza and Namoya mines, which be­gan com­mer­cial pro­duc­tion in Septem­ber, 2012, and Jan­uary, 2016, re­spec­tively. The com­pany’s longer-term ob­jec­tives in­clude the de­vel­op­ment of two ad­di­tional ma­jor, wholly owned gold projects, Lu­gushwa and Kami­tuga. The four projects, each of which has a min­ing li­cence, are lo­cated along the 210-kilo­me­tre-long Twan­giza-Namoya gold belt in the South Kivu and Maniema prov­inces of the Demo­cratic Repub­lic of the Congo.

We seek Safe Har­bor.

Richard Wil­liam Bris­senden, John Allen Clarke, Michael Hankin Li, Jiongjie Lu, Robert L Rauch, Robert Alexan­der Ror­ri­son, Der­rick Horst Weyrauch

(BAA) Shares: 109,757,811

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