Extractive Industries

Hummingbird mulls selling non-core assets

Hummingbird Resources plc has secured a US$30 million loan as it initiates an independent review of its West Africa operations, including the possible sale of its non-core assets.

New: leadership team to guide the company through its next phase (Pixabay)

KOUROUSSA

The company’s largest shareholder CIG SA lent $20 million, payable in tranches, and consolidated a previous US$10 million short-term loan.

Hummingbird said it anticipated changing the loan into a longer term fixed-rate, gold-linked loan note, currently being finalised, with opportunities to increase its size.

The company continues to progress “several other non-equity financing options” as it approaches full operational capacity.

The review aims to restructure Hummingbird’s business to “maximise operational performance and efficiencies across the group”.

Moves will include ramp up expected shortly at the Kouroussa mine in Guinea.

During Q3, lower-than-forecast mining volumes, delayed pit staging, and processing plant optimisation have delayed commercial production, now targeted for Q4 2024.

The now completed mill relining is expected to lead to a more consistent ramp-up of mining with production rates projected to “significantly increase”.

Additional external support is planned for new term optimisation plans at Kouroussa and Yanfolila in Mali.

The evaluation could additionally include selling non-core assets and / or exploring opportunities.

The company has held “informal, non-binding” talks with “several parties” regarding the sale of certain assets including Dugbe in Liberia, whose owner earlier this month received a $75m offer.

COMPANY MOVES

Hummingbird added that corporate restructuring would target “cost efficiencies, improved governance, and enhanced accountability” for overall improved performance.

A chief transformation officer, to be appointed as a board executive, will lead the assessment and implement the “transformation” which will also involve board and management changes.

Current chief executive and interim executive chairman Dan Betts will become executive chairman.

Mining recruitment specialists Lincoln Strategies have been appointed to find a new CEO

Hummingbird also plans to appoint mining executive Oumar Toguyeni to the board as a non-executive director, subject to checks.

Mr Toguyeni is a director of the company’s largest shareholder Nioko Resources Corporation.

Hummingbird said that its primary lender Coris Bank International supported the new measures designed to evolve the business into a “robust mid-tier gold mining company”.

Mr Betts added that the company was committed to taking decisive actions.

“The group-wide review is an important step towards optimising our production capabilities and enhancing shareholder value.

“After 17 years of building Hummingbird from a grassroots exploration company to a gold producer with an annual run rate exceeding 200,000 ounces, I believe the time is right for a new leadership team to guide the company through its next phase.

“I am proud of what we have achieved and will continue to focus on strategic opportunities and key relationships as chairman of Hummingbird.”

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