Glencore-backed Horizonte Minerals (AIM, TSX: HZM) has been placed into administration after it was unable to secure the necessary financing for the completion of its Araguaia nickel project in Brazil.
Horizonte’s board has appointed Geoff Rowley and Chad Griffin from FRP Advisory as administrators. Their mandate is to assess the company’s situation to secure the best possible outcome for its creditors. This decision seeks to maintain the business’s value for creditors and other stakeholders, it said.
According to the company, discussions with secured creditors and existing and potential new investors regarding alternative scenarios will continue.
Potential outcomes include raising financing at the subsidiary level, disposing of the Araguaia project while it is in care and maintenance, liquidating the project’s assets, or considering other options available under Brazilian law.
Horizonte has already requested a suspension of trading in its ordinary shares on the London Stock Exchange and the Toronto Stock Exchange.
The company began construction of the Araguaia mine in May 2022, with the aim of producing up to 29,000 tonnes of nickel a year for the stainless steel market.
Last month, however, it announced that it had failed to secure the additional financing needed to complete the construction of the project, following an 87% increase in the estimated cost to build the mine to more than $1 billion.
