Bounty Mining Ltd.'s board rejected another unsolicited funding proposal from QCoal Pty. Ltd., saying it is not a superior alternative to Amaroo Blackdown Investments LLC's recapitalization proposal.
The company said the structuring of the proposal will not result in enough funding to meet the company's obligations, while options for supplementary funding under the proposal are also limited.
Moreover, a key issue is that the company needs funds by Sept. 30, while the timing of QCoal's offer is uncertain and additional time for completing executable agreements may cause delays since the current offer is conditional, nonbinding and incomplete.
The proposal also requires Bounty to enter into an off-take agreement with QCoal; however, it is unclear whether the QCoal team will be able to effectively market Bounty's coal products.
Due to these and for certain other reasons, the directors decided the Amaroo proposal offers greater solvency and certainty.
Bounty secured a working capital facility of up to A$20 million from Amaroo in December 2018, which was later extended to A$35 million in March 2019.
