Golden Energy and Resources note holders to get US$3 for every US$3,000 if they agree to changes in terms

MAINBOARD-LISTED coal miner Golden Energy and Resources (Gear) AUE is seeking note holders' approval to modify the terms governing its 8.5 per cent senior secured notes due 2026.

The proposed amendments would let Australian subsidiary Stanmore Resources and related entities take on more debt over a majority stake in the owner of 2 Queensland coal mines, according to the announcement released by Gear on Wednesday (Dec 8).

Gear and certain subsidiaries would also be able to take on more debt - which could be secured - "to support the future corporate and operational activities" of the company and subsidiaries.

Gear last month unveiled plans for 75.33 per cent-owned Stanmore to buy an 80 per cent stake in the Queensland coal mine owner, BMC, for US$1.2 billion. Stanmore could also pay up to US$150 million more if the average sale price crosses a certain threshold after 2 years.

Holders who consent to the amendments by Dec 21 will get US$3.00 in cash for every US$1,000 in principal amount of notes, but cannot revoke the consent once given.

The proposed amendments need consent from the holders of at least the majority in aggregate principal amount of the outstanding notes, which is now some US$285 million, Gear noted.

The solicitation agent for the consent solicitation is Mandiri Securities, which has an office in Asia Square Tower 2, while the information and tabulation agent is Morrow Sodali in London and Hong Kong.

Gear shares closed unchanged on Wednesday at S$0.305, before the announcement.