First Quantum disputes allegations of debt default

Wed Nov 27, 2013 11:30am EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

By Euan Rocha

TORONTO Nov 27 (Reuters) - First Quantum Minerals Ltd said on Wednesday it strongly disputes the claims of some debtholders that it has violated indentures and defaulted on a parcel of debt taken on following its acquisition of rival Inmet Mining.

The Canadian base metal miner said it has received a notice from a small group of its noteholders including CI Investments , Barometer Capital and funds managed by Capital Group that it has violated certain indentures on two separate series of Inmet's senior notes that come due in 2020 and 2021.

First Quantum strongly disputes that a default has occurred based on the legal opinion of two law firms, the company said.

"These claims are without legal foundation, highly opportunistic and run the risk of destroying value for all Inmet noteholders, a large proportion of which are not part of the noteholder group," said First Quantum's Chief Executive Philip Pascall in a statement.

"We remain very confident in the strength of our legal position," he said, adding that the company intends to take immediate legal action to enforce it but is open to reaching an amicable resolution.

First Quantum said it still retains very strong credit and a robust balance sheet, as demonstrated by an extension commitment it signed with Standard Chartered Bank last month.

CI Investments, Barometer Capital and Capital Group officials were not immediately reachable for comment.