Lucapa Diamond Restructuring Plan Promises Full Creditor Repayment and Shareholder Returns
Lucapa Diamond Company, the Perth-based miner behind the Lulo alluvial mine in Angola and the Merlin project in Australia, is eyeing a potential lifeline through a planned Deed of Company Arrangement (DOCA).
The arrangement could ensure full repayment to creditors and offer a partial return to shareholders.
Administrators Richard Tucker and Paul Pracilio of KordaMentha were appointed in May after Lucapa faced falling diamond prices and operational pressures.
They have now reached a binding term sheet with Dubai-based Gaston International, part of the Jemora Group, paving the way for a restructuring that would transfer Lucapa’s shares to the proponent, subject to creditor and court approvals.
Under the proposed DOCA:
Creditors are set to receive 100 cents on the dollar.
Shareholders may receive up to A$0.018 per share, exceeding Lucapa’s last traded price of around A$0.014.
Lucapa has faced challenges amid a downturn in global diamond markets, putting pressure on its operations in Angola and Australia.
Gaston International, a global mining investor with a focus on critical minerals and gemstones, could provide Lucapa with the financial backing needed to safeguard its high-value assets. The partnership would also support the continuity of Lucapa’s Angolan and Australian operations.
The restructuring process depends on:
Creditor approval at meetings scheduled for August 20.
Court clearance under the Australian Corporations Act.
Any required regulatory consents.
If approved, the DOCA would preserve Lucapa’s operations and deliver better outcomes than liquidation, the administrators said, offering a renewed path forward for the company and its stakeholders.
