Two FTI Consulting executives to help Weatherly International with restructuring

Following an approximately month-long strategic review of its sale and asset disposal options, copper mining firm Weatherly international, which operates primarily in Namibia, has entered into insolvency proceedings. The firm has appointed Simon Kirkhope and Andrew Johnson – two senior executives from FTI Consulting – to administer the proceedings. 

The global dip in commodity prices, particularly those of precious metals, dealt a significant blow to the mining industry in Africa and across the world. Most businesses saw their revenues dip, and have had to engage in diversification efforts to remain relevant, primarily with respect to leveraging technological applications in the sector to reduce costs and increase efficiency.

However, not all firms have been able to ride this wave successfully. Founded in 2000, Weatherly International (WTI) is a UK-based copper mining firm that has an extensive African practice, operating out of a subsidiary in Namibia. The firm specialises in operating medium-scale mines, choosing to remain outside of the competition among large mining corporations.

Following a period of cyclical lows in commodity prices, WTI was forced to seek financial advice from two consulting firms – Numis Securities and Treadstone Resources Partners – in April this year, primarily regarding the firm’s financial future in light of high debt-levels and dismally low revenues.

The firms reviewed several options for WTI, including the sale of the entire share capital, restructuring of its debt, disposal of assets or issuance of equities. As a result, WIT decalred that it had entered an offer period, wherein suitors were welcomed to discuss the sale of the firm and arrive at terms.

Now, a month after entering its offer period, the firm’s financial situation has become uncertain to the point that its ordinary shares have been suspended from trade on the Alternative Investment Market – the sub-division of the London Stock Exchange on which WIT is listed. The firm has now entered insolvency proceedings, the administration of which will be conducted by Simon Kirkhope and Andrew Johnson of FTI Consulting.

A statement on WTI’s website reads, “The Administration appointment relates solely to WTI with all other entities within the Group remaining outside of an insolvency process and continuing to trade under control of their directors. The Joint Administrators will work closely with the management of the subsidiary entities to establish the optimal strategy for the Group with a view of maximising recoveries to creditors of WTI.”

Kirkstone and Johnson are both Senior Managing Directors of FTI’s Corporate Finance & Restructuring segment, each with approximately 15 years of experience in the field. Kirkstone’s expertise lies in restructuring and insolvency of both a consensual and forced nature, while Johnson has additional expertise in financial advisory and contingency planning.