London Mining hit by Ebola outbreak and goes into administration

16 October 2014 (Last Updated October 16th, 2014 18:30)

UK-based London Mining, which had been operating the Marampa mine in Ebola-hit Sierra Leone, has gone into administration after being hit by falling prices of iron ore, rising debts and the impact of the Ebola virus in West Africa.

UK-based London Mining, which had been operating the Marampa mine in Ebola-hit Sierra Leone, has gone into administration after being hit by falling prices of iron ore, rising debts and the impact of the Ebola virus in West Africa.

London Mining had been working with Goldman Sachs and Standard Chartered to find a potential buyer for the only operating iron ore mine in the country, but failed to to do so as there was no value left it its shares, reported The Telegraph.

Apparently, the company appointed administrators from PricewaterhouseCoopers (PwC) to run the firm and find a buyer for the Marampa mine.

"Our focus is to ensure that a buyer is found for the Marampa mine operations given it is such an important part of the Sierra Leone economy." 

PwC joint administrator and partner Russell Downs said: "The collapse in iron ore prices and the resulting impacts on this business have been very dramatic.

"Our focus is to ensure that a buyer is found for the Marampa mine operations given it is such an important part of the Sierra Leone economy. We are liaising with key stakeholders and asking for a short window of forbearance as we look to conclude a transaction."

London Mining CEO Graeme Hossie said: "The Marampa mine retains excellent fundamentals and it is our sincere wish for it to find the appropriate financial support to continue operating over the longer term."

The company employs 1,400 employees at Marampa, among which the non-essential staff have already been withdrawn due to the Ebola outbreak.

To prevent the spread of Ebola, which has so far claimed around 4,500 lives in Sierra Leone, Guinea and Liberia, London Mining is constructing a 130-bed Ebola treatment centre near Lunsar and has donated £103,000 to Sierra Leone.

The company said in a statement: "The board and management will be working with the administrator of London Mining to maintain the Marampa mine as a going concern, although at this time this is not confirmed."

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