Today’s news is rather unfortunate and it comes out of the Czech Republic. For those of you that don’t know, the Czech Republic is in Central Europe, east of Germany and north of Austria. If you don’t know where Germany is, we won’t be able to help you.
The owners of New World Resources Plc are trying to get a last-ditch meeting with Finance Minister Andrej Babis tomorrow. They are searching for ways to avoid a company bankruptcy that would leave 13,000 miners and 8,000 affiliated workers out of a job.
The situation has reached a critical level because an agreement with the government involving restructuring has to be made by April 13 to avoid default.
New World Resources is the last Czech producer of coking and thermal coal. Almost two years ago, it restructured its debt and received an injection of cash from multiple investors. NWR is just another victim of this unprecedented slump in commodity prices. It’s stock peaked back in 2008 after its IPO and has since lost more than 99% of it’s value.
Like many, many mining stories you read these days, this is a pretty tough situation for these guys to be in. Ultimately they wind up asking for credit to survive the economic downturn but it’s difficult to repay any of that money with low commodity prices and eventually they are again asking for another influx of cash just trying to stay afloat. Once this market turns, there will be happy miners and happy suppliers. Until then, check out our website and just imagine the day that you’ll need big machines like ours running full force again.
*All information for this story was taken from mining.com.
