African Copper, the owners of Mowana copper mine in Botswana, faces a possible delisting from the Toronto Stock Exchange (TSX) as the company shares do not meet listing requirements.
The TSX, where the miner has a primary listing, has raised a wide range of concerns over the company, following the situation it finds itself in.
The delisting will be a second blow in a row to the outfit after the credit crisis forced the company to put its Botswana mine operation on care and maintenance.
The company CEO, Chris Frederics, told Sunday Standard this week that it appears to the TSX that African Copper’s financial condition is questionable as to whether it will be able to continue as a going concern.
“The TSX has also indicated that it appears that the public distribution, price or trading activity of the shares has been so reduced as to not warrant continued listing,” he said, reiterating earlier statements in the market wires.
African Copper, like the rest of mining outfits, has been hit by the credit crunch as most of the miners list on stock exchanges to raise capital, but since the liquidity crisis, ability to raise money has faded.
The company is faced with a $15 million working capital deficit that has led to mothballing of Mowana mine to conclude negotiations for required financing.
It is expected that the company must satisfy the TSX that it meets all applicable requirements for continued listing set out in Part VII of The Toronto Stock Exchange Company Manual by March 13, 2009.
“Should the TSX decide to delist the shares, the shares will be delisted on or about April 13, 2009,” the company said.
Fredericks added that if the shares are delisted from the TSX, the company may decide not to apply to list the shares on another Canadian stock exchange, in order to conserve working capital.
However, because of different rules governing bourses, African Copper’s shares will continue to be listed on AIM and the Botswana Stock Exchange (BSE).
In Botswana, the company is listed on the venture capital board.