Less than a year after completing a restructuring, Galactic Resources (TSE) has filed an assignment in bankruptcy under the laws of Canada.
After selling its 50% interest in the Ivanhoe gold property in Nevada to Newmont Mining last year for US$13.4 million, Galactic successfully restructured US$31.5 million in 7% exchangeable debentures. The restructuring left the company with more than $7 million in working capital, no debt and more than 76 million shares outstanding in mid-1992.
Peter Guest, president, stated that the company’s board regretted that it had been required to take steps toward bankruptcy, but the action was made necessary by the state of Colorado’s inability to reach a settlement agreement with Galactic with regards to the company’s wholly owned subsidiary, Summitville Consolidated Mining.
Galactic shut down operations at its Summitville open-pit heap-leach mine in 1991, and has been negotiating with various Colorado agencies for the implementation of a comprehensive program for reclamation and water management at the mine.
Unable to come to an agreement with the state, Summitville Consolidated Mining filed for liquidation on Dec. 4, 1992, under Chapter 7 of the U.S. Bankruptcy laws. Trading in the company’s stock is suspended until further notice.
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