LUXEMBURG, LUXEMBURG--(Marketwire - Mar 6, 2013) - Northland Resources S.A. (NAU.TO)(NAUR.OL)(NPK.F)(NAURO.ST) ("Northland" or "the Company") announces that Northland Resources AB (publ) (the "Issuer") today informed Norsk Tillitsmann ASA, as Bond Trustee, that the Issuer is not permitted to pay the interest due on March 6, 2013, due to the ongoing corporate reorganization process.
As previously announced, the Issuer filed on February 8, 2013 with the Luleå District Court for corporate reorganization (Sw. företagsrekonstruktion) under Swedish law on the basis of a shortage of liquidity. This corporate reorganization process is ongoing.
The interest due and payable by the Issuer on March 6, 2013 under the USD 350 million, 13 per cent Senior Secured Bond Loan, constitutes a pre-reorganization liability. The Issuer is thus not permitted to make this payment due to the ongoing corporate reorganization process.
Karl-Axel Waplan, President & CEO, Northland Resources S.A.
Northland is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara project is complete and production ramp-up started in November 2012. The Company expects to produce high-grade, high-quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company expects to exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study ("DFS") for its Hannukainen Iron Oxide Copper Gold ("IOCG") project in Kolari, northern Finland and for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant.