Glencar Mining PLC
19 December 2001
Glencar Mining plc ('Glencar' or 'the Company')
Update re Wassa Gold Project
Glencar announced on 27 November that Satellite Goldfields Limited (a 59.4%
indirectly owned subsidiary of the Company)('SGL'), the Senior Secured Lenders
and Golden Star Resources Limited ('Golden Star') had signed a letter setting
out the intention of Golden Star to complete the purchase of the Wassa Mine.
On 4 December, it was announced that the Senior Secured Lenders had enforced
their security and that a receiver had been appointed to SGL (in order to
ensure the timely completion of the sale) as consent to the sale of the
project had not been forthcoming from the Subordinated Lender, CDC Group plc.
Further, the announcement stated that the Company had requested the
reconfirmation by the lenders of the commitments given by them to Glencar
earlier this year to limit and release Glencar's guarantee on the satisfactory
completion of the sale process (now expected by end January 2002).
The Senior Secured Lenders have now indicated that it is their intention to
honour the commitments given in this regard upon satisfactory completion of
sale. However, the Subordinated Lender (who is owed approximately US$19
million) has indicated that, because the Senior Secured Lenders have appointed
a receiver to SGL, it does not intend to fulfil the commitments given to
Glencar in the letter of 9 May 2001 ('the letter of intention') which was
written on behalf of all the lenders.
The Directors of Glencar are satisfied that the Company has done everything
required of it under the terms of the letter of intention, as confirmed by the
Senior Secured Lenders' willingness to honour their commitments. Glencar now
intends to take this matter further with the Subordinated Lender.
In addition, Glencar contests the right of the Subordinated Lender to
participation in the Glencar guarantee and legal advice is currently being
sought on this issue.
Press queries:
Hugh McCullough (Chief Executive):
+ 00 353 (0)1 661 9974
19 December, 2001