TORONTO, Jan. 22, 2018 /CNW/ - On December 22, 2017, Banro Corporation
("Banro") and its Barbados based
subsidiaries (collectively, the "Companies") commenced
restructuring proceedings under the Companies' Creditors
Arrangement Act ("CCAA") pursuant to an initial order granted
by the Ontario Superior Court of Justice (Commercial List) (the
"Court"). FTI Consulting Canada Inc. has been appointed
Monitor (the "Monitor") of the Companies for the CCAA
proceedings.
Pursuant to an order of the Court dated January 18, 2018, the Companies have today
initiated a sale and investment solicitation process ("SISP") to be
conducted in conjunction with the CCAA proceedings. The Initial
Order provides that the Monitor will assist the Companies in
conducting the SISP. Banro and the Monitor, through its
affiliate, FTI Capital Advisors ULC ("FTICA"), are seeking parties
interested in acquiring or investing in the business or the assets
of the Companies in a manner that is determined to be a superior
offer to the Recapitalization Plan under the CCAA process.
Interested parties will be given an opportunity to submit offers
for the acquisition of the business and assets of some or all of
the business and assets of the Company and its subsidiaries (i) for
cash proceeds equal to the outstanding amount of the DIP Facility,
the priority debt, 75% of the affected parity lien debt of Banro,
and cash consideration sufficient to repay all amounts due under
the stream agreements or treatment of the stream agreements on the
same terms as the Recapitalization Plan, or (ii) on other terms
determined to be superior to the Recapitalization Plan, in
accordance with the terms of the SISP (capitalized terms as defined
in the SISP). The operating assets of the Companies include
the Namoya Mine and the Twangiza Mine located in the Democratic Republic of the Congo.
Under the SISP, potential buyers will be provided a confidential
information memorandum and access to a virtual data room on
execution of a non-disclosure agreement acceptable to Banro and the
Monitor. The deadline for submission of non-binding letters
of intent is 12pm (Eastern Standard
Time) on March 2, 2018, and
the deadline for submission of binding bids is 12pm (Eastern Standard Time) on April 9, 2018.
A copy of the SISP and all related CCAA materials can be found
on the Monitor's website at:
http://cfcanada.fticonsulting.com/banro/. Any potential buyer
interested in participating in the SISP should contact FTICA at
banro@fticonsulting.com. Similarly, any questions in respect
of the SISP should be directed to the Monitor at
banro@fticonsulting.com
Cautionary Note Concerning Forward-Looking
Statements
This press release contains forward-looking statements. All
statements, other than statements of historical fact, that address
activities, events or developments that the Company believes,
expects or anticipates will or may occur in the future (including,
without limitation, statements regarding the CCAA
proceedings, the restructuring process, including the sale
and investment solicitation process, and the ability of the
Company to meet its obligations, the Company's liquidity and
ability to meet payment obligations and the timing of meeting such
payment obligations, the Company's intentions for the future of its
business operations and long-term strategy, and the Company's
commitment to its employees and suppliers) are
forward-looking statements. These forward-looking statements
reflect the current expectations or beliefs of the Company based on
information currently available to the Company.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of the Company to
differ materially from those discussed in the forward-looking
statements, and even if such actual results are realized or
substantially realized, there can be no assurance that they will
have the expected consequences to, or effects on the Company.
Factors that could cause actual results or events to differ
materially from current expectations include, among other
things the possibility that the Company will be unable to
implement the restructuring or obtain advances under the interim
financing due to the failure of one or more of the conditions
precedent to be satisfied, or that the SISP will be
unsuccessful. In addition, actual results or events
could differ materially from current expectations due
to instability in the eastern DRC where the Company's mines are
located; political developments in the DRC; uncertainties
relating to the availability and costs of financing or other
appropriate strategic transactions; uncertainty of estimates
of capital and operating costs, production estimates and estimated
economic return of the Company's projects; the possibility that
actual circumstances will differ from the estimates and assumptions
used in the economic studies of the Company's projects; failure to
establish estimated mineral resources and mineral reserves (the
Company's mineral resource and mineral reserve figures are
estimates and no assurance can be given that the intended levels of
gold will be produced); fluctuations in gold prices and currency
exchange rates; inflation; gold recoveries being less than
expected; changes in capital markets; lack of infrastructure;
failure to procure or maintain, or delays in procuring or
maintaining, permits and approvals; lack of availability at a
reasonable cost or at all, of plants, equipment or labour;
inability to attract and retain key management and personnel;
changes to regulations affecting the Company's activities; the
uncertainties involved in interpreting drilling results and other
geological data; and the other risks disclosed under the heading
"Risk Factors" and elsewhere in the Company's annual report on Form
20-F dated April 2, 2017 filed on
SEDAR at www.sedar.com and EDGAR at www.sec.gov. Any
forward-looking statement speaks only as of the date on which it is
made and, except as may be required by applicable securities laws,
the Company disclaims any intent or obligation to update any
forward-looking statement, whether as a result of new information,
future events or results or otherwise. Although the Company
believes that the assumptions inherent in the forward-looking
statements are reasonable, forward-looking statements are not
guarantees of future performance and accordingly undue reliance
should not be put on such statements due to the inherent
uncertainty therein. The forward-looking statements
contained in this press release are expressly qualified by this
cautionary note.
SOURCE Banro Corporation