Avocet Mining Plc said May 31 that its Société des Mines de Bélahouro SA unit, or SMB, has secured a standstill agreement with creditors representing about 70% of its debt as they are pondering options to restructure SMB.
Over two months, creditors will refrain from exercising their rights and remedies and from taking any legal action in relation to SMB's outstanding debts.
In exchange, SMB agreed to a payment scheme for deliveries of services and goods, which will be in sync with receipt of gold proceeds once the SMB-operated Inata gold mine in Burkina Faso resumes full production.
Earlier in May, Avocet placed the majority of the workforce at the Inata mine under technical unemployment for three months to lower fixed costs. The company is also experiencing a shortage of critical supplies including reagents and explosives, which is causing production interruptions at the gold mine.